LockChain, a platform driven by blockchain technology, has claimed to be able to offer hotel rooms at 20% below the average price.
The claim came as hotel and travel companies have continued to experiment with the technology, both in private and public blockchains, as a method of cutting out costly intermediaries.
LockChain, which counts 100,000 hotels available for booking, offers a decentralised technology with a marketplace that enables peer-to-peer transactions between guests and hotels via blockchain using its native LOC tokens.
The company said that, in a test including 800 hotels, it was were able to successfully cut hotel prices all over the world by an average of 20%, sometimes even more. Hotels rated five, four or three stars were included, with comparisons made against Booking.com’s cheapest room, then compared to Agoda and Lockchain.
CEO Nikola Alexandrov said: “Most people don’t realise this, but when you book a stay through booking.com or Airbnb, between 20% and 30% of your money goes out to middlemen without adding any value to the actual travel experience. Thanks to advanced blockchain technology, we are able to change that to 0% and give that value back to the travellers and hosts.”
Following the announcement, the company changed its name to Locktrip. The group said that everyone could use the platform for free, but those listing property could pay a small amount to have a more prominent listing.
Elsewhere in the sector, B2B network Winding Tree announced that it had “hit multiple goals in its development roadmap”. As at Lockchain, the company also provides travel suppliers, travel sellers, and travellers themselves with an alternative way of connecting, using blockchain technology to keep all data exchanged in these marketplaces safe while holding down administrative fees.
The company said that it had now released its own digital currency, Líf, which it described as more than just a cryptocurrency, but able to carry information including booking data, travel identification, baggage tracking details and loyalty points.
Augusto Lemble, co-founder & blockchain architect, Winding Tree, said: “Now, we’ve turned our full focus to creating the platform that’s going to transform the travel industry. With the work we’re doing, developers won’t even need to know anything about blockchain to be able to use our platform alongside current solutions.”
Winding Tree has partnered with groups including Lufthansa, Nordic Choice and CitizenM.
Lennert de Jong, chief commercial officer, Citizen M, told Hotel Analyst: “CitizenM is always on the lookout for new innovations that can have an impact to change industries and/or business models.
“Blockchain is technology that has been invented to circumvent central power on agreements made between individuals, whether it is that person A agrees to buy service from company B, person A agrees something with person B, or company A agrees to do business with company B.
“In the hospitality industry it is ridiculously expensive to get paid for hotels by their guests, very difficult and fragmented to authenticate an individual, and the power of distribution is with a handful of tech companies, that are charging heavily for this disintermediation.
“Within the Winding Tree partnership citizenM plays a facilitating role with industry knowledge and helping to explore possible solutions for issues in the fragmentation of distribution technology, payment and authentication.”
Last month Markus Binkert, SVP, distribution & revenue management, Lufthansa Group Airlines, said: “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 decentralised and intermediate-free travel marketplace.”
Winding Tree said that, although it had no plans to become customer facing, it had over 100 applicants who wanted to plug into the Winding Tree platform and would create interfaces.
The company said that it could also work with intermediaries, with suppliers able to build commissions into their offers. Winding Tree’s CEO, Maksim Izmaylov, told Forbes: “Winding Tree aims to foster innovation. What if most of the travel inventory data is publicly available? Endless apps could be built on such a blockchain.”
HA Perspective [by Katherine Doggrell]: A school close to this correspondent recently announced that it was doing away with maths homework, causing a spate of public hangings driven by the PTA. Not so fast, said the remaining teachers. The children were instead required to explain the latest maths concepts to their parents, to the point where their parents could answer questions themselves. Fiendish.
And so, we come to blockchain technologies, an area where many of us have a pretty good idea what’s going on, but delve any deeper and the knowledge, unlike the technology, falls apart. What is important to know here is, we hope, not the how, but the why.
Blockchain technology is secure and open source, which are two things you don’t see next to each other very often. It is hoped that these decentralised open-source booking systems will not only open up the routes to market in a frictionless fashion, but also make controlling and selling inventory nimble in a way that makes the current technology look hopelessly unresponsive.
The question now is what this will look like in the marketplace. Triptease’s chief tease, Charlie Osmond, cautioned that technology doesn’t mean much “unless people are building interesting things with it”. It’s time for that killer app.
Osmond also warned that a lack of buy in might also slow adoption up. And, given the hotel sector’s past capacity for missing the boat, it’s possible. But headlines touting 0% commissions in an era when cost-control is everything, are bound to turn heads.