I recently had the privilege of speaking with Jerry Cuomo, vice president of blockchain technologies at IBM (NYSE: IBM), for a wide-ranging interview. Our talk left me extremely interested and excited about blockchain technology, as well as its potential to transform not only businesses, but also our daily lives.
In Part 1, we discussed what blockchain is at a high level, and the types of active networks in use today on IBM's platform. In Part 2 below, we discuss the nuts and bolts of how IBM's blockchain platform came to be, where and how IBM operates its active networks, and the companies involved in the Hyperledger Project. IBM provided the transcript. I edited some quotes for clarity.
A new type of blockchain
While blockchain technology for things like bitcoin are truly open and "unregulated," large corporations obviously have much more stringent protocols in terms of security, privacy, and speed. I asked Cuomo how IBM's expertise in mission-critical business operations helped enable these large "active networks" with many leading corporations participating.
IBM Cloud and "old friend" Z
IBM posted a great third quarter, highlighted by the success of its new Z mainframe and growth in its cloud segment, which is part of the company's strategic imperatives. Given the importance of blockchain technology going forward and the vast amounts of data and computing power needed, I asked Cuomo where these active networks are hosted, and how IBM's technology fits in.
The Hyperledger Project
Another piece of the new blockchain technology that struck me was that it is built upon open-source technology. Some may tend to think of older technology companies as hanging onto a proprietary and closed system, in which the company keeps its technology more secret, which also makes it difficult for customers to switch vendors.
However, more and more legacy IT companies like Microsoft and IBM are adapting, and even thriving, in an open-source world, where technology is shared among competitors. A recent example of this is IBM's partnership with Hortonworks, which runs a Hadoop distribution on open-source Apache software. Similarly, the IBM blockchain technology was built at the Hyperledger Project, which hosts about 10 open-source projects that work toward building out blockchain technology for business.
I asked Cuomo about how the project came about, who controls the Hyperledger project, and how it all works.
I then asked what it is like to both collaborate with your competitors on the technology, and what the advantages are of a "frenemy"-type of arrangement. As the aforementioned Hortonworks and other open-source software companies have shown, you can be both open and financially successful, so I was curious to learn about the current state of competition among companies at the Hyperledger Project, and IBM's place in the consortium.
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Teresa Kersten is an employee of LinkedIn and is a member of The Motley Fool's board of directors. LinkedIn is owned by Microsoft. Billy Duberstein owns shares of IBM and Microsoft. The Motley Fool owns shares of Oracle. The Motley Fool has a disclosure policy.