Lufthansa has announced a partnership with Winding Tree, a specialist in blockchain-based B2B travel bookings, which will help the airline group introduce blockchain applications to its own digital products.
Lufthansa established its relationship with Winding Tree through the Lufthansa Innovation hub, which aims to identify and capitalize on the new technologies which will drive travel in future.
Winding Tree hopes to disrupt travel distribution by using blockchain to break down barriers of current GDS and OTA business models, while streamlining the exchange of data and currencies.
Winding Tree details what it views as the weaknesses in the travel industry and its plans for disruption in a White Paper: A Practical Application of Blockchain for the Travel Industry. In it, Winding Tree writes:
“The consolidated nature of the travel distribution platforms creates a situation where the intermediaries have no incentive to use new technologies. Instead, they spend resources on locking their customers into using systems that were in some cases created decades ago.
“Current archaic technological solutions hinder innovation and create extremely high barriers to entry for new platforms. Blockchain technology allows for a ground layer to be built for a truly free and competitive market in travel distribution.”
It adds:
“The concentrated and centralized state of travel distribution bears a strong cost on consumers, while poor currency exchange solutions inflate consumer prices. The problem is particularly acute for travel startups, the main sources of innovation in the sector.”
Markus Binkert, senior vice president distribution & revenue management Lufthansa Group Airlines says of the decision to partner with Winding Tree:
“Lufthansa Group has engaged in the development of APIs, for instance supporting IATA NDC standard, to offer a direct access to its offers to customers and distribution partners.
"By integrating these APIs with Winding Tree’s public blockchain Lufthansa Group enables all innovative partners who develop cutting-edge travel applications to access these offers via a decentralized and intermediate-free travel marketplace.”
Maksim Izmaylov, founder and CEO of Winding Tree adds:
“The partnership with the Lufthansa Group will allow us to build blockchain-based travel apps which not only adhere to the requirements of airlines but we will be able to test these with Europe's largest airline, further validating the efficiency and scalability of the platform.”
To finance its development, Winding Tree is launching a token sale of its cryptocurrency “Líf” on the first of November.
Lufthansa says it will participate in the pre-sale pending regulatory clearance from Swiss authorities, but would not comment, when asked, on the amount of its investment.
Related reading:
TUI's blockchain initiative blips IBM's radar
Removing friction at the airport using mobile and blockchain
