Air Canada’s blockchain play: Less than meets the eye

A major airline commits to blockchain as a distribution avenue. That’s the story being spun about Air Canada‘s deal with Winding Tree. And, to some extent it is accurate. But one key point that remains relatively muted in the reporting: Air Canada really is not doing anything with blockchain.

Take the comments from Pedro Anderson, Founder and Chief Operating Officer of Winding Tree:

As the first North American carrier to work with Winding Tree’s public blockchain platform, Air Canada is showing itself to be a real leader in innovation. We are excited to have their valuable collaboration in creating the ideal developer experience and their ongoing feedback along the way as we build an open environment for travel distribution.

Sounds like Air Canada is really ready to play on the chain, right?

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Air Canada’s Director of Global Product Distribution Keith Wallis adds some quality language around the innovative move and the value it presents:

We are pleased to be participating with Winding Tree in this innovative project for a new travel distribution channel. As Canada’s largest airline, and a global leader in innovative airline distribution solutions, Air Canada recognizes the importance of leveraging this next generation technology.

Alas, the closing of Wallis’s comment is where the wheels fall off that idea. Air Canada is decidedly not doing anything blockchain-specific with this effort (emphasis mine):

We plan to integrate Air Canada’s Direct Connect API with Winding Tree’s public blockchain platform, giving blockchain-savvy users the ability to access our content directly from the source.

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Winding Tree secured access to Air Canada’s API to process bookings. That is important for Winding Tree. The move allows the company to process bookings without a third party intermediary, reducing costs. Direct Connect transactions also potentially expose additional marketing and bundling options. It is a big deal. It improves the viability of the Winding Tree concept. But is it not really a blockchain play by the airline.

If anything, the move is best seen as an anti-GDS play. Winding Tree’s goal is to reduce transaction costs and to bypass the GDS platforms in delivering booking options to consumers and travel alike. Airlines are keen to reduce GDS fees as well. Participating makes sense, especially given the minimal risk.

Air Canada does nothing different in presenting its data to the API endpoint as part of this deal. The hard work sits on Winding Tree to read that data, translate it and process transactions against it. Once that all works then Air Canada gets the bookings and saves a few dollars on distribution costs. And if it never comes to life the cost for the airline to play is roughly nil.

Air Canada joins Air New Zealand, Air France, KLM, and the Lufthansa Group of airlines as committed to Winding Tree’s platform.