Flying with Blockchain

How blockchain makes flying safer, cheaper, and more convenient.

Leah Zitter
Read +
Follow Us

Flying can be a hassle, but blockchain is on the rise and the world is soon going to be very, very different.

When was the last time you found your schedule overturned because of a missed or cancelled flight? USA Today reported that cancelled flights cost airlines, stranded passengers, and some corporate companies millions, according to masFlight that analyzes flight operations.

Airlines have to notify you of scheduled changes at least fourteen days before they occur, otherwise you receive compensation or a refund. You may also get money back if changes resulted in significant inconvenience, damage, or extra expense. For example, say you missed seeing your dying mother, and this happened within a 12-hour window of your flight. The problem is, airlines have what is known as the “flight data problem”, where, there are many cases of airlines and airports collaborating to share flight data. This data still resides in separate silos. The result is that when there are flight delays; passenger apps, airport flight information display systems, and airline agents give you contradictory information.

The existence of fractured, centralized information also leads to other problems. This includes websites shutting down, becoming hacked, or airlines unable to track maintenance needs, and struggling to track passengers and baggage. The first happened with Delta in 2016, where a computer outage cancelled more than 650 flights and delayed many more in the US, Japan, Italy, and the UK. The event happened to United in 2017 with the Dr. Dao incident, where a man was dragged from an overbooked United flight in Chicago.

How Blockchain Helps You and Airlines

With 3.8 billion air travelers in 2016 and air travel projected to double over the next nineteen years, according to the International Air Transport Association (IATA) , the airline industry has its work cut out for them. They need to provide maximum security and safety, show responsiveness and care, display efficacy, and communicate with their stakeholders in a timely manner.

That’s where blockchain helps you and airlines with the following aspects:

      • Ticketing - Most airlines give you the option of e-tickets. This is where your travel details are, in essence, dematerialized, stored in and retrieved from a massive database. Blockchain can use smart contracts to add business logic and terms and conditions around how your ticket is sold and used, which can help the tickets be sold by different partners, in real time, from anywhere in the world.
      • Passenger information - The amount of data shared in real time is enormous. Forget about coordinating flights. Even tracking passengers on a single flight can be a trial. Each airline has to, at the bare minimum, keep track of when a passenger has checked in for their flights, when their tickets are scanned as they board, and where their bags are in reference to their final destination. Blockchain provides a solution to overbooking flights and losing revenue.
      • Cancelled or delayed flights - Some airlines refund but not all. There may also be a fee for changes. Blockchain ledgers share real-time encrypted, up-to-date changes and information among all relevant parties. You can inform airlines ahead of time about unexpected changes, possibly resulting in the airline refunding your ticket.
      • Maintenance - Airlines have to ensure that all data about the status of an engine or other parts are up to date and securely shared by all interested parties. Usually, airline maintenance logs are in cumbersome databases and at worst, in paper binders. The blockchain can collate all, verify that all parts are legitimate and offer a real-time record of every repair and every purchase. This is done every time it has been handled and by whom, from the beginning of the aircraft’s existence. This visibility can take the practice of maintenance, safety, and aircraft security to new levels.
      • Loyalty - Loyalty points save you money. Usually, you have to wait until loyalty points settle and accrue to use them and you are limited on where you can spend them. By tokenizing loyalty points on the blockchain, you can get instant value by redeeming them on the spot.

The Story of Fizzy

Fizzy, rolled out by French insurance giant AXA, is an example of a blockchain platform that revolutionizes the airline industry. Fizzy promises customers instant and conflict-free refunds on airline delays of more than two hours.

Airline passengers subscribe to Fizzy and enter their ticket numbers on Fizzy’s shared ledger. Fizzy’s smart contracts record traveler details and the condition that whenever an airline has at least a two hour delay, payment is automatically triggered and the traveler receives compensation. Fizzy’s smart contracts are connected to global air traffic databases, so compensation for passengers is automatic. Customers do not need to file claims and the smart contract minimizes discrepancies between the insurance company and customers.

For now, payouts are issued in fiat currencies, though AXA aims to use Ether eventually. Fizzy, too, only covers USA transatlantic flights and Charles de Gaulle Airport in Paris. By end 2018, it plans to cover the rest of the world.

The Future?

Blockchain technology for airline industry is a perfect match. Multiple sectors of the airline industry depend on instant, coherent, consistent, and thoroughly accurate data for making and implementing plans. This includes sharing traveler and operation information, among other aspects.

In the airline industry, when the data system is hacked, collapses, or provides contradictory information, the airline gets scrutinized. Not only is operational integrity and revenue generation at stake, but so is safety and security. If blockchain technology improves the communication of these different actors and their touchpoints, well then, we can anticipate easier flights and far less disasters in the air.