The German airline Hahn Air and Swiss-based blockchain startup Winding Tree are testing blockchain-powered airline tickets. Decentralized booking platforms could reshape the travel industry.
When Maksim Izmaylov, Dave Montali, and Frederick Nowotny flew from Dusseldorf to Luxembourg on a Hahn Air flight before two weeks, the tickets they held in their hands had something special to them. They were booked via a blockchain-powered platform, the first real-world airline tickets living on a blockchain.
Maksim Izmaylov is the Founder of Winding Tree, Dave Montali is his Chief Information Officer, and Frederick Nowotny is the Head of Sales Engineering at Hahn Air. The blockchain-powered tickets were a trial and part of a cooperation between the German airline and the Swiss blockchain startup.
Hahn Air investigates blockchain-powered distributed systems
Hahn Air is probably the biggest little German airline that you’ve never heard of. The company offers scheduled and charter flights within Europe and operates a fleet of three Cessna business jets – a rather modest operation compared to airline giants like Lufthansa or Eurowings. That’s why you will probably be surprised to hear that the company sells tickets worth $1 billion per year.
Besides its airline operation, Hahn Air also sells tickets on behalf of other airlines. Today, Hahn Air has an airline ticketing network that consists of more than 350 airlines, 100,000 travel agency partners in 190 markets, and has sold more than 35 million tickets worldwide.
In 2018, the company launched Hahn Air Technologies to look at innovations and new technologies, including blockchain.
Frederick Nowotny comments, “We at Hahn Air are constantly exploring new technologies and we are proud to now demonstrate our technical capability to issue blockchain-powered Hahn Air tickets. We are pleased to be partnering with Winding Tree, the most established company when it comes to distributing travel inventory in the blockchain. Our goal is to investigate and monitor the opportunities this technology holds for travel distribution, even if widespread acceptance is still a vision of the future.”
Winding Tree wants to decentralize travel booking
Hahn Air’s interest in blockchain technology has led to the partnership with Winding Tree, an open-source travel distribution platform.
The problem Winding Tree is trying to solve is the massive centralization of the global travel industry. Although there are various airlines, travel websites, and agencies, most of these operators use the same global distribution systems (GDS), such as Amadeus or Sabre. A GDS collects data on flights and hotel rooms and provides these data to travel agents or corporate travel bookers. In return, they take a share of the profit, which can be as high as 20%, leading to inflated prices for travelers.
To address this issue, Winding Tree has created a blockchain-based platform that offers an alternative to GDS. Airlines and hotels can publish their inventory directly to potential customers without the need for B2B intermediaries.
Using the Winding Tree platform, Hahn Air can list inventory, manage reservation requests, and receive payments once the booking process is complete. Payments can be accepted in cash, credit card, or cryptocurrency, either the lif token – Winding Tree’s native digital currency – or ether.
The cooperation between Hahn Air and Winding Tree is still early stage. After the flight, the airline will analyze the details of how things worked for the first blockchain ticket and look into ways on how to commercialize it. Hahn’s Head of Corporate Strategy, Jörg Troester, said, “We are not at that point right now.” – Not yet.