Airport interest in blockchain technology is growing as the aviation industry invests around $40 billion per annum on IT, according to SITA’s new Air Transport IT Insights study.
Blockchain is fast emerging as the priority technology for future exploration among airport and airline CIOs globally, according to new research released by SITA.
The 2018 version of its Air Transport IT Insights report reveals that blockchain technology has attracted the most research attention this year.
SITA believes that blockchain offers multiple use cases ranging from passenger identification to ticketing, asset tracking and managing frequent flyers, all of which help the various stakeholders in the industry work better together.
Gustavo Pina, director of SITA Lab, comments: “The biggest obstacles standing in the way of a seamless passenger journey and truly efficient air travel, are the siloed processes across the many stakeholders, including airlines, airports, ground handlers and control authorities.
“They act as significant speed bumps at every step of the way. By collaborating as a single industry, we can smooth that journey and blockchain is one of the technologies that has the potential to make that possible. This explains the industry’s significant interest in it.”
One of the key benefits of blockchain technology, according to SITA, is the ability to have multi-enterprise applications. These work across multiple organisations locking data immutably into the blockchain rather than having individual applications running separately and exchanging data on a case-by-case basis.
This, it says, is how this technology can provide a ‘single source of truth’ to all stakeholders.
Today, 59% of airlines have pilot or research programmes planned around blockchain for implementation by 2021, which is up from 42% last year.
Similarly, airports also continue to experiment with blockchain with 34% planning R&D projects by 2021. The most commonly expected use of blockchain for both airlines and airports is to streamline the passenger identification process with 40% of airlines and 36% of airports saying this would be a major benefit.
While the focus in the industry is predominately on passenger identity management, both airlines and airports also see that blockchain could have major benefits across several other use cases.
Airlines stated they expected blockchain technology to provide benefits in the roll out of passenger tokens for frequent flyer programmes (34%) and e-tickets (31%).
Airport CIOs have item custody change tracking (such as baggage) (28%) and operational efficiency (24%) as areas that have potential benefits.
Secure and easy travel
According to Air Transport Insights, overall, airlines and airports are investing to deliver secure and easy travel for passengers, with biometric technology another key priority.
Indeed, the report states that biometrics are being incorporated into the evolution of self-service at airports, and predicts that in the next three years, 77% of the world’s gateways and 71% of airlines plan to introduce major programmes or commence R&D in biometric ID management.
SITA’s CEO, Barbara Dalibard, says: “Secure and seamless travel is a must for the air transport industry. It is encouraging to see that both airlines and airports are investing in biometric technology to deliver a secure, paperless way to identify passengers across multiple steps of the journey. We have already seen great success where we have implemented it at airports across the world.
“As the research shows, integration causes challenges and the variety of legislative demands can be daunting for airlines and airports.
“To deliver a seamless passenger experience, we must all collaborate – airlines, airports, governments and industry suppliers – and use technology to automate, and even eliminate, tedious processes. We achieve the best results when we work together, this has been most apparent when we incorporate secure biometrics into the passenger journey.”
A number of identity management solutions – including biometric systems – already exist, of course, and are basically designed to improve the passenger experience while helping airlines and airports across the world meet the variety of regulations from governments and border agencies.
The most common of these is identity verification at self-service check-in kiosks, which is already in use at 41% of airports, while 74% have plans to deploy the technology by the end of 2021.
Self-boarding gates using biometrics with ID documentation, such as a passport, are also set to become commonplace over the next three years, with 59% of airports and 63% of airlines expecting to use them.
SITA’s research shows that the industry faces some challenges for the full adoption of biometrics for passenger identity checks.
More than one third of airlines cite integrating the tools and technologies at airports, and a lack of standards for processes and technologies for integrating checks, as the major challenges.
For airports, the situation is similar, though 39% of them say meeting government and legislative requirements is also a major challenge.
Airlines and airports are also considering new technologies for passenger identity management such as blockchain.
Growing investment in new technology
Overall, investment in technology is rising. Today airlines spend $30 billion on IT and this is set to rise in 2018 to account for 3.67% of their revenue, up from 3.14% in 2017.
Airports, too, are spending more on IT, rising from 4.39% of revenues to an expected 5.69% in 2018. This equates to $10 billion, up from $8.6 billion in 2017.
SITA believes that the strength in investment is encouraging and reflects the digital transformation and growing reliance on technology across the board.
Artificial intelligence (AI) is seen as beneficial across a range of airline operations with 84% of airlines planning to have major or R&D programmes in place by 2021. This is up from 52% in last year’s survey.
Airports, too, are investing in AI with 61% planning a major programme or R&D over the next three years, up from from just 34% in 2017.
While both airlines and airports are investing in AI, their uses are different. Airlines are looking at the potential of using AI for virtual agents and chatbots with 85% planning to use it here by 2021. Some 79% of airports are currently using, or planning to use, AI for predictive analysis to improve operational efficiency.
Dalibard notes: “It is clear that the will of the industry is to change the way we travel by improving efficiency and making the passenger journey as secure and seamless as possible. This requires a concerted and aligned drive, true collaboration, and SITA is fully committed to this.”
Over 180 senior IT executives at the top airlines and airports, representing 39% of global airport and 27% of global airline passenger traffic took part in SITA’s 2018 research.