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SK C&C, a subsidiary of SK Group that provides IT services, has developed a logistics system based on blockchain technology that it says could accelerate digitization of cargo shipping and other logistical services.

While data related to logistics is currently recorded and saved in central databases, blockchain technology would allow multiple parties involved in a logistical process, including cargo owners, shipping firms and delivery companies on land, to share and manage data related to cargo all at once, according to the company. 

Blockchain is best known for its current application in the digital currency bitcoin, in which transactions are recorded on a continuously growing list of records called blocks that can be secured from tampering and revisions. Peer-to-peer networking allows several devices to share resources and communicate directly with each other, making it possible for a blockchain database to manage itself. 

SK C&C’s blockchain logistics service will use affiliate SK Telecom’s network to track and manage cargo containers. SK’s Internet of Things network, dubbed LoRa, allows real-time tracking of each container’s location while it is traveling on land through IoT sensors attached to the container. The sensors can also track the container’s inside temperature and humidity.

At sea, the sensors can collect the same data, but it can only be shared to customers when the cargo arrives on land because the network has not yet been established at sea. 

Still, the company believes the blockchain-based system can help improve the transparency of shipments and let customers know where a package is at every step of the process. It can also contribute to cutting the time of cargo delivery and operating costs, the company said, because logistical records don’t have to be duplicated with blockchain technology. 

“Currently, shipping companies and each land carrier have independent logistics systems that are often incompatible,” a spokesperson from SK C&C said. “In such a case, cargo management data needs to be reconfirmed and recorded every time the cargo is transferred to another sub-carrier, making the logistics process inefficient.” 

Earlier this month, the company tested the technology on containers delivered from Korea to Shanghai. 

SK C&C is not the only IT company pursuing a blockchain system for logistics. Global tech giant IBM is rapidly expanding its blockchain capabilities. In March, the company announced plans to collaborate with the world’s largest shipping company, Maersk Line, to use blockchain technology in its global supply chain.

IBM wants to digitize the paper trail for Maersk’s tens of millions of shipping containers around the world, a process it says could save billions of dollars in costs.

SK C&C’s local competitor, Samsung SDS, entered the smart logistics business in 2011 with its logistics platform Cello. It is also considering implementing blockchain technology on its system, according to a source within the company, but no official progress or announcement has been made yet.

Samsung SDS has continued expanding the market for its Cello system. On Tuesday, it inked a contract with Kerry Logistics in China to establish a joint venture there.

It is the third joint venture by Samsung SDS after signing partnerships with logistics companies in Thailand and Vietnam.

BY KIM JEE-HEE [This email address is being protected from spambots. You need JavaScript enabled to view it.]