By now, you’ve no doubt been caught up in or at least been hearing all the buzz about blockchain, that promising but perhaps far in the future technology with the extreme potential to upend currency markets and the world of payments.
As the world’s leading provider of hospitality technology solutions for commission payments for hotels and travel distributors, our company, too, is excited about its possibilities.
The reality, however, is that widespread use of this highly touted new technology is probably still years away, and the hospitality industry faces a number of challenges in trying to adopt global standards for unified payments.
So, what exactly is blockchain? It’s a shared but highly secure smart contract and digital ledger system that anyone in the chain can view and change but only within the parameters of the agreement.
In the world of hotel payments, blockchain promises to speed up the payment process while offering a constant and accurate step-by-step view of exactly what has been paid and by whom, creating a whole new level of transparency between hotels and the travel professionals who book them.
While blockchain technology is fully available for application today, it is not quite ready for prime time in the hospitality sector as there are a number of hurdles to its widespread adoption.
For starters, the industry is extremely fragmented, with thousands of hotel owners operating hundreds of thousands of hotel properties. Widespread adoption would require everyone from independent, chain and REIT-structured owners to agree to implement and comply with blockchain to make it viable. Legacy hotel systems would have to be upgraded to meet this new transaction type, with a high cost of implementation, as every hotel would have to be on board.
Much of the industry still operates on legacy software systems, and many of these systems, old or new, are still very much tied to credit cards, credit card processing and traditional invoicing requirements.
Changing software to operate on blockchain would require specialized technologists with expertise in cryptography and advanced computing – fields that go way beyond general networking and cluster and cloud computing that are prevalent today.
And then, of course, every player needs to be able to convert blockchain transactions into real currency, which opens up a whole host of other complications.
The good news is that while we fully intend to remain the industry’s payment leader — regardless of what our technological platform is built on — we already deliver on seamless contracting and payment facilitation. We also deliver transparency while creating trust and mediating between hotel suppliers and agency vendors. These prerequisites to blockchain are built into the foundation of our business, thus paving the way for our future of blockchain enablement.
I like to think of our company as today’s early “blockchain,” a cornerstone of the longstanding commission business. For more than 20 years, we’ve been the trusted, secure and transparent meeting ground between the fragmented world of hotels and travel agencies, the place they can go to ensure their contracts are fully enforced and their payments are made in a timely and accurate fashion.
Whether it’s through blockchain advances or technologies yet to be developed, we intend to be your trusted, transparent meeting ground for decades to come.
— Dale Dawson, Vice President of Product Strategy, Onyx CenterSource