What is 'Blockchain as a Service' and why might it interest your company?
E-everything: Big tech companies now offer BaaS (Blockchain as a Service)—a way to access blockchain technology without incurring huge costs.
Blockchain is a technology on the rise, but the companies that really want to use it may encounter a few obstacles: it’s new, it’s relatively unknown and its implementation—like any technological change—entails organizational risks. In addition and this may be the main practical problem for companies - professional blockchain experts are few and far between, and expensive.
The average annual salary of a blockchain developer in the United States is $130,000 (and over $150,000 dollars in Silicon Valley, Boston and New York), compared to the $105,000 earned by a software developer, according to Burning Glass Technologies, a consultant specialized in employment data. If you’re a freelance specialist, you can charge $150 an hour, according to Upwork, a website specialized in independent workers. Despite these high fees, demand has not stopped growing: according to Financial Times, the number of offers on LinkedIn related to blockchain tripled in 2017.
As a result, the interest in implementing blockchain and the real difficulties of doing so are causing several tech companies to now offer Blockchain as a Service (Baas) to businesses that prefer to outsource the development of blockchain solutions.
This new term, ‘BaaS,’ uses the ‘B’ from ‘blockchain’ and adapts it to the current business jargon that designates the ‘aaS’ (‘as a service’) offerings that a supplier provides to its customers, for remote service and cloud computing.
This links BaaS to similar terms, such as IaaS (Infrastructure as a Service), PaaS (Platform as a Service), and probably the most common one, Software as a Service, SaaS. All of them essentially offer the same advantages—cost savings—because you pay for a fixed subscription or consumption, and for thr simplicity of use. A good example is BBVA's strategic agreement with Red Hat to squeeze all of the possibilities out of ‘cloud computing’ within the ‘as a Services’ category.
A good test bench
In the case of blockchain, the BaaS format allows companies to familiarize themselves with blockchain technology before making conclusive business decisions about its use. Several companies have decided to develop this new avenue for business.
In November 2015, Microsoft became one of the first companies to develop this service, through its cloud computing division Microsoft Azure. In addition, the software giant incorporates the artificial intelligence of its virtual assistant Cortana, in a strategy similar to that of IBM, which offers BaaS with its question-answering computer system, Watson.
Oracle, Amazon Web Services and SAP are other big names that are betting on Blockchain as a Service
Of special note in this field is the work being done by R3, in which BBVA participates, along with other large global banks. R3 has created Corda, a Distributed Ledger Technology (DLT) designed specifically to respond to the needs of financial institutions that use this technology. It isn't exactly blockchain, as its creators stress, but it takes the essence of the cryptography-based technology and smooths the edges to facilitate its use in the financial sector.
To date, Corda is greatest combined effort of the leaders in the financial industry in applying blockchain and DLTs, but there’s still a long way to go. For many companies, BaaS is the best way to begin the journey.