Julian Clark, global head of shipping at Liverpool law firm Hill Dickinson says blockchains will transform the way we do business and will be ‘the next big game-changer’. Tony McDonough reports
A revolution in e-commerce is happening right now and the impact on the global shipping sector in the coming years will be immense.
That was the message delivered by Julian Clark, global head of shipping at Liverpool law firm Hill Dickinson, who addressed members at an event organised for members of industry body Mersey Maritime.
Industry transformation
‘Blockchain’ is a word that many people in business may have heard without being sure what it actually means. According to Julian, blockchains will transform the way shipping companies do business and, in some ways, could be as significant as the emergence of the internet itself.
“When the world wide web was invented, some people were saying it would come to nothing,” he said. “Remember that, because some people are now saying the same thing about blockchains.”
So what is a blockchain? Put simply, a blockchain is a system of computers, in which information is stored and shared among all participants of the network and the concept originally emerged to allow transactions using cryptocurrencies such as Bitcoin.
Real-time
Julian explained further: “A blockchain is a public and decentralised ledger that can be used to monitor and track products as they pass through a supply chain and that chain can be monitored in real time by all the participants.”
Because the information is not stored on a single computer or server, but instead is recorded in many locations, it means it cannot be hacked or tampered with so is seen as far more secure from an e-commerce perspective.
Julian added: “It is like a giant vending machine with a glass front that no one controls. It cuts out the middle men, increases speed and efficiency of transactions, reduces costs and increases profit.”
More in tune
As well as being a lawyer, Julian offered his own experience as a musician who writes, records and publishes his own music. He said blockchains had revolutionised the process of getting a piece of work from conception to market.
It would require an array of “middlemen”, including publicity and copyright agents, a record company, a sheet music company, a distribution company and both physical and online distributors and could take well over a year. Under a blockchain system most of those intermediaries are cut out and the process can be expedited within days.
“I believe in 10 years there will no longer be a need for record companies,” said Julian.
“Blockchains offer a single, seamless system. Everyone on the network can find out about any problems all at once. In shipping, companies such as Maersk are leading the ways on this.”
Dispute resolution
Julian added blockchains also offered the potential to solve disputes quickly as the technology can anticipate disputes before they even happen. However, he also acknowledged there were some issues to address.
“Not all smart contracts will be recognised by the courts,” he said. “The technology is moving forward very quickly and regulatory regimes are struggling to keep up. Blockchains could also create a problem of information overload for everyone on the network.”
However, he added: “Blockchains will be the next big game-changer.”