Technology originally developed to help NASA communicate with deep space probes now lies at the heart of a new Microsoft blockchain project that would track products as they move around the world.
But more than that, Microsoft's Project Manifest, unveiled today, could eventually help ensure the origin of the products used to create goods and the labor used to build them conform to a company’s ethical standards.
Built via an initial partnership with Los Angeles-based Mojix, Project Manifest leverages the startup's widely used Internet of Things (IoT) platform, which is currently being integrated with the ethereum blockchain to help factories, distribution centers and retailers track goods using radio frequency identification (RFID) devices.
The RFID implementation has the potential to inform every member of the supply chain the moment a shipped product goes missing, according to the firms involved.
In interview, Microsoft’s global business strategist, Yorke Rhodes, explained why the new partnership was chosen to become the cornerstone of future supply chain implementations.
Rhodes told CoinDesk:
"Project Manifest is actually designed to look at the challenges of visibility in the supply chain. One of the reasons why we worked with Mojix is because they already have technology and know-how in supply chains for scanning RFIDs."
Mojix has raised $40m in venture funding from Red Rock Ventures and others, and is already helping a number of major clients track goods, including Perry Ellis, Prada, Scania Trucks, Cessna and British Petroleum.
A new database
Currently, Mojix’s big data framework behind the IoT platform is powered by a noSQL database, but Project Manifest puts a new twist on this design.
An early version of the blockchain solution now integrates Mojix’s platform, called ViZix, with a smart contracts application layer, and was exhibited during an event last week at the National Retail Federation’s convention in New York City.
Mojix's ViZix blockchain integration is being designed to take advantage of the rapidly growing rate that manufactured goods are being labelled with RFID, Bluetooth and GPS sensors.
Last year, retailers in the US increased RFID adoption by 32%, according to a report by Auburn University's RFID Lab. In total, 4.6 billion RFID labels were expected to hit the market last year, with room to grow by as much as 85%, according to an IDTechEx Research report.
The more of these devices that exist, the stronger the system of smart contracts can become.
Project Manifest will likely evolve along similar lines to Microsoft's Azure blockchain-as-a-service platform, with additional members joining in the future – partners who will increase the potential commands that can be written into the contacts.
Initially, the visibility provided by giving participants in a supply chain access to the same, private record is expected to cut costs on auditing, insurance, supply chain financing, risk mitigation and reduced charge-backs that result when a good is lost or mishandled.
The money that could potentially be saved from the permissioned blockchain application alone is enough to drive the development, Mojix’s vice president of retail business development, Tom Racette told CoinDesk.
Last year, the National Retail Federation reported an estimated loss of $46.2bn-worth of retailer inventory as a result of shoplifting, robbery and loss. According to a Loss Prevention Media report the average cost of cargo theft during transportation was $300,000 per incident.
Racette explained the impact blockchain could have on these losses:
"Essentially, what we are trying to do is we’re trying to prevent claims so that when a shipment gets to a retailer it’s accurate, and if there’s any problems throughout the process it gets corrected and validated before it even ends up at the retail door."
Exact details of the average losses incurred throughout the supply chain are hard to come by, according to Mojix, because suppliers don’t want to give the impression they’re unable to handle client products.
But should Project Manifest ever connect real-world supply chains via a blockchain some of the resulting data might eventually be made public, according to Microsoft's Yorke.
While customer data pertaining to identity and cost will likely always remain cryptographically secured behind the permissioned implementation of the ethereum blockchain, other data that could actually result in increased sales and might one day move to the public implementation, he said.
"The consumer would like to be able to see where the goods are to make sure they’re not coming from slave labor and things like that," said Yorke. "By way of giving consumers the ability to do that we’d like to push certain parts of the data to a public blockchain."
In addition to the Mojix partnership, this early incarnation of Project Manifest includes work with a standards body and support from the academic sector.
Today, Racette is in New York City to attend a meeting with global business language standards body GS1 to explore its EPCIS data standard for trading partners.
Just last week, Project Manifest confirmed that two professors and 10 students from Auburn University’s RFID lab would also participate. Already, the lab has been engaged with seven brands and three retailers to try to create ways to deal with a recent increase in supply chain data.
As part of Project Manifest, the team is currently studying electronic proof of delivery, vendor scorecarding, anti-counterfeiting, anti-grey market, and data exchange data, with a report expected by the end of the year.
Lab director Justin Patton told CoinDesk that the combination of more RFID technology and more sophisticated types of measurement are making it increasingly difficult to accurately track and exchange data.
"We are looking at blockchain to help fill this need with a flexible and secure solution. We believe that we can adapt GS1’s EPCIS data standards to work with blockchain as a medium and we’re off to the races."
Shipping image via Shutterstock