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Live From Sea Asia 2017

Tech will drive disruption in shipping

Tech will drive disruption in shipping
The shipping industry is ripe for disruption and the driver for change will come from outside the industry as shippers demand higher efficiency. Transas ceo Frank Coles said the impetus for the change is the improvement in technology now available and will take place within the next five to 10 years.

The impact is already being seen in areas such as vessel traffic management systems and fleet management systems where real time AIS data is being packaged and re-sold with value-added information by service providers.

However the real change will come from outside the industry and will radically change the way the shipping and logistics business is run, Coles predicted. "Someone from outside is going to come and do it because nobody here is going to do it the right way," he said. Coles noted that just within the last year there have been some 240 startups which raised $4bn and it seems likely that a disruptor will emerge from among this.

Alluding to the way that e-commerce companies such as Alibaba and Amazon have taken control of their own transportation needs, Coles said while they may not own the actual assets, they will have absolute control over the information behind the business. "Within five years you will see the cargo owners controlling the logistics of shipping," he said.

Coles warned that shipping companies and other asset owners will have to adapt to this new reality or risk getting left behind. "You must do it or you will be out of business. If the owners do not adapt they will simply get replaced," he said.

He concluded that ship management companies will come into much greater prominence in the future because a lot of owners will be challenged by the fact that shippers will demand a much higher level of transparency and efficiency and they will be looking to ship managers to implement the innovation and disruption needed.

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