Taking the supply chain to new heights

If 2005 is to be remembered for anything, it may be as the year the last gap in always-on, always-connected communications was closed. This in turn will be a great opportunity to solve the problem of supply-chain visibility. Until now, two of the biggest dead zones for trade and commerce have been the result of poor communications in the air and on the sea. Now, though, the big guns are being brought to bear on the problem.

Boeing, for example, is slowly but steadily ramping up its Connexion by Boeing  communications services. Using satellite links, CBB offers airline passengers Internet access, including access to corporate intranets and e-mail over secure VPN connections. In addition, maintenance and medical data, as well as live feeds from the plane’s infamous black box, can be sent to ground personnel. (This is all happening as the plane is flying at 550 mph, mind you.)

In July, CBB announced that Singapore Airlines will be the first to offer live in-flight television feeds over CBB’s Wi-Fi service. Here’s how it works: CBB contracts with TV networks to have their signals sent to one of Boeing’s “earth stations.” The earth station sends the signals as compressed MPEG-4 streams to the plane, where they are unpacked and relayed in turn to the audience in their seats.

Already, deals are in the works under CBB’s executive services/government division to extend this new video capability to the enterprise, Laurette Koellner, president of CBB, tells me. Soon CBB will offer teleconferencing to corporate and government jets from 37,000 feet.

Meanwhile, Boeing and Unisys, among many others, offer maritime service to connect cargo ships to shore. Koellner says CBB’s new maritime service is a “game changer,” however, because of its low cost.

Until now, most maritime data services were expensive -- about $12 per minute. CBB’s service can be had for a flat $2,800 per month, giving a vessel everything from VoIP for its crew to maintenance and supply-chain data, no matter where on the high seas the ship may be. 

The FCC is working to fill in the communications gaps, too. In the first quarter of 2006 it will auction radio spectrum to be used to enable air traveler cell phone use in flight. Boeing may be one of the few noncarriers to bid on that spectrum, according to Koellner.

Filling in the communications gaps, however, is only the first step toward solving the bigger problem, that of supply-chain visibility, says Peter Regen, vice president of Global Visible Commerce  at Unisys. “The biggest challenge is connecting all the pieces,” Regen explains. “What a shipper wants is visibility [from] end to end.”

As cargo goes from factory, to trucks, to containers, to ships, to rail, each node uses a different communications system. Regen says we need a single solution that can connect the various networks found in a “multimodal” supply chain. The main culprit, according to Noha Tohamy, principal analyst at Forrester Research, is a lack of interoperability and process standards.

So what can we learn from all of this?

The need to stay connected has created an opportunity for companies like CBB and Unisys to solve a problem. But it is also proved that once you take an opportunity and create a solution, the solution usually creates another problem -- er, opportunity -- albeit at a higher level.