The fate of TradeLens data in the air as Maersk drops the blockchain platform

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Maersk is to abandon its pioneering but divisive foray into blockchain, TradeLens, after failing to garner sufficient commercial interest to cover its costs.

But questions remain about what will happen to the data from the platform.

“The intention is for the platform to go offline by the end of quarter one, 2023,” Maersk said.

In its time, TradeLens, which was launched with IBM, entered into agreements with various big hitters such as Hapag-Lloyd, ONE, CMA CGM and MSC, who signed up as “trust anchors” or “foundation carriers”, enabling crossing – compatibility and established frameworks for data sharing with Maersk – or users.

A live ticker on the TradeLens website shows that nearly 70 million containers have been processed and 35 million documents published through the platform.

TradeLens also had registrations at more than 20 ports, including PSA Singapore, International Container Terminal Services, Patrick Terminals, Modern Terminals in Hong Kong, the ports of Halifax, Rotterdam and Bilbao, as well as PortConnect, PortBase and Holt Logistics at the Port of Philadelphia.

However, Maersk explained yesterday that this interest was not sufficient to cover the costs. IBM scaled back investments in the platform early last year.

Rotem Hershko, Maersk head of business platforms, said: “Although we have developed a viable platform, the need for full global industry collaboration has not been achieved… TradeLens has not reached the level of commercial viability necessary to continue its work and meet the financial expectations as an independent business.”

When TradeLens started, many were critical of a perceived overreach by the world’s largest container line, leveling accusations of monopolistic behavior and attempts to squeeze out freight forwarders and other small-scale stakeholders. Steve Walker, supply chain expert and outspoken critic of the platformcalled TradeLens “a foolhardy idea… [which] gives Maersk no credit”.

Although Maersk has said it will continue to support “all parties involved” in ensuring business continuity, it conspicuously does not explain what will become of the vast data collected by TradeLens during its four-year operation. Walker is one of many who have expressed concern.

“The question is who owns this data from everyone [shipping lines] who signed up for this?” he asked today. “Do [Maersk] sell it on, to offset the costs? More information is needed.

“I hope [Maersk] is challenged by other lines on this private data and what should happen to it. It will be a worse mess if Maersk decides to sell it to another company that sets up a similar hub.”

At the time of publication, Maersk had not responded Loadstar’s inquiries.

Despite great interest in recent years, blockchain is associated with high entry costs, thanks to high energy requirements and long waiting times during transactions. Despite its extraordinary potential, peripheral but highly publicized blockchain use cases such as bitcoin and NFTs have done little to cement its reputation as a serious technology in the eyes of investors.

Commenting on social media, Vespucci Maritime’s Lars Jensen said TradeLens was to some extent “a child born out of the blockchain hype seen five years ago”.

But he said the shutdown “should not be seen as an indication that blockchain does not have a place in shipping – it probably does for some applications. However, it is an indication that it is commercial use that determines the fate of new technology initiatives and not the sophistication of the technology used.”

All eyes are now on DP World, which launched its own rival service to TradeLens, CARGOES Logistics, in October. Blockchain was said to be “in our product plans” but “not specifically highlighted”, a DP World spokesperson told The Loadstar at the time.

“Blockchain is hard for the average joe to understand,” said Patrik Berglund, co-founder and CEO of Xeneta. The Loadstar. “Most business attempts to build something new fail… one must fail, statistically, for others to succeed.

“It’s very brave to try something new, but most people will fail, so you have to be brave enough to try different things.”