A public authority like the Council of Tampere Region needs to be on top of technological development and phenomenon. One of the key areas promising to a region is platform economy and technologies related to it, such as IoT, 5G, AR/VR, AI, robotics, blockchains, cloud services and so on.
A few weeks ago the Ministry of Economic Affairs and Employment made a public release concerning the platform economy roadmap for Finland. It declares that "Finland has to be at the frontline of developing enablers of platform economy, such as artificial intelligent, next generation networks, blockchains and data economy."
The Council of Tampere Region has been working with Chainfrog Oy to find some practical answers as to how blockchains can be applied to platform economy thinking.
What blockchains are and how they can be applied
Blockchains were first announced to the world in a 2008 paper published anonymously by a person or persons writing under the pseudonym of Satoshi Nakamoto. In the process of solving the "double spending" problem without a middleman, Nakamoto invented the blockchain, paving the way for distributed and decentralized sharing of data and tamperproof recording of transactions across low-trust boundaries, and resulting in a technology that may prove to be as revolutionary as the internet.
Blockchain is a foundational technology that allows different parties that don’t fully trust each other, to transact - currency, data or even computer code - in an auditable manner that both parties can rely on, without requiring a middleman or arbitrator.
Bitcoin is the first and so far the most successful implementation of a value-transfer protocol built on a blockchain base, and is essentially an open and decentralized form of electronic cash.
Blockchain consists of a blend of four prior technologies - a hash linked list for providing data integrity, a peer-to-peer network that allows the system to run in a decentralized manner, a consensus protocol that ensures that participants all follow the same rules thereby building trust, and digital signing, which allows identity and authority to be established based on cryptographic principles.
Case example: Waste Utilization Marketplace
One clear example where blockchain technology can be used in the context of platform economy was identified while creating the concept of a Waste Utilization Marketplace. There were several supporting factors implying a blockchain solution: there is no clear leader to start or maintain a marketplace, the market is segmented and distributed and no common trust or middleman can be identified.
"Companies producing waste materials have a core business that they focus on, and generally do not want to run a trading platform. However, they would probably participate in using a platform as it solves the problem of removing unwanted waste, and may raise extra revenue. This is an example where blockchain can be applied; there is no leader but a lot of benefits to all if a secure market place would be established in a cost-efficient way," says Circular economy project manager Johanna Alakerttula from the Council of Tampere Region.
How blockchains can be applied to wider Business and Innovation Ecosystem
The Tampere region has been a forerunner of Innovation platforms - Demola, Protomo, Mediapolis, HealthHUB are clear examples. However, neither in this field there is no clear leader or centralized player who can lead or manage the development of innovation. Blockchain, as a way to create trust, transparency and security in a distributed system or organization, can and will create one of the relevant elements in developing new kinds of business and innovation ecosystems.
In our region, we can create new kinds of innovation policy tools, such as a decentralized platform ecosystem for innovation initiatives and stakeholders. Thereby, we can renew our innovation philosophy and bring the ecosystem of our innovation environment to the next level. The next level here means more added value, transparency, transactions, accessibility and collaboration between platforms and companies.
Tampere Region as a Forerunner of Innovative Thinking
"To raise the R&D activities back to billion euros level would require about 1500 - 2000 new R&D jobs to be created in the Tampere region. With a co-operation with companies, universities and research it could be possible, but it would need success in new openings and especially new innovation based business located to the region," says Director of Innovation and Foresight Petri Räsänen from the Council of Tampere Region.
The question therefore remains: how can blockchains play a practical role in boosting Tampere Region economic development, and create the much needed new thinking, innovation, jobs and closer co-operation?
This blogpost is part of regional InnoDigi – project and it is written in co-operation with Kimmo Rouhiainen and Keir Finlow-Bates from Chainfrog Oy, as an end result of blockchain workshop. Main target of the Inno-Digi -project is to run digital experiments among innovation platforms and find tools for digital regional innovation policy.
Picture 1. Basics of blockchain. (Chainfrog, 2017).
About the author
Taina Ketola works for the regional innovation and business ecosystem in the Council of Tampere Region. Interested in digital transformation, public sector development and new kinds of ecosystems as an organizational structure. She performed as one of the writers of the Open Innovation Platform Handbook which defines the concept of ‘innovation platform’ and defines the role of the platforms as a tool for urban development. Strongly working towards vision of an active regional innovation and business ecosystem.