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IBM has struck yet another notable deal in Latin America.

Announced today, a partnership between IBM and AOS, a Colombian provider of logistics solutions, finds the two firms developing a new blockchain and Internet of Things (IoT) solution for the logistics business.

Being built with IBM Blockchain and IBM Watson to track the provenance and status of trucks and their goods, the solution records the handling of transactions and information on cargoes to create greater transparency in the delivery process, according to AOS's director of innovation, Ricardo Buitrago.

"Having the right hardware, software and cloud environment is what gives our clients the protection to ensure blockchain is secure. We’re thinking about the whole spectrum, how we can secure as much as possible and how we can do it with the most integrity," explained Jorge Vergara, CTO of IBM Colombia.

So how does it work?

Trucks are equipped with RFID tags that contain data on the vehicle, the name of the driver and details of its load, according to Buitrago.

IoT sensors would track the journey of the shipment, as well as the availability of free space on a truck, and record this data on the blockchain for all relevant parties to access. According to IBM and AOS, this process is usually done manually, and is slower and prone to error.

Buitrago told CoinDesk:

"[T]he trucks are sealed with bar code seals, which are entered into the blockchain and serve as a safety indicator that the load has not been altered. Additionally, we are considering registering the GPS signal of each truck to record its route and increase traceability data.”

The solution integrates with IBM’s Watson IoT system to check in on factors like weather and temperature, which can impact the journey and the estimated delivery time.

Hard data

IoT in logistics is expected to be worth more than $10bn by 2020, per market research. A report from Cisco and DHL estimated that IoT in logistics and supply chain will generate $1.9tn in value.

Companies often lack hard figures or data on where exactly their shortcomings and losses are in the transport cycle, said Buitrago, adding:

"Obtaining this information is one of the biggest benefits they will have when implementing our IoT solution in their logistics operation."

But as blockchains become more efficient and produce greater network effects, the next challenge will be growing that network.

One company has signed up to use the new solution so far. AOS declined to name the firm, but Buitrago said deployment is planned for July. For now, the solution will only be available in the Colombian market.

Lorries image via Shutterstock

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