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Blockchain-based Revenue Sharing in Railway Transport

Sector: Tertiary sector · Industry: Rail transport · Organisation: DB Regio · Maturity level: Concept

DB Regio is developing a blockchain solution together with DB Systel for automated and transparent distribution of ticket revenues between different transport operators. The current system is non-transparent, inflexible and time-consuming, as traffic surveys do not reflect actual shares. The new solution aims to enable automated processing and easily integrate new transport participants.

Documentation status

Description

DB Regio and DB Systel developed a blockchain solution for the revenue sharing process in integrated transport. Previously, revenues were distributed to providers statistically via sample surveys — a complex, costly, and contentious procedure. With the blockchain solution, smart contracts are negotiated in advance between all parties; the revenue sharing logic is then permanently and automatically applicable. The distribution takes place per individual ticket, immediately and transparently for all parties involved.

Jörg Strubberg, Head of Revenue Management at DB Regio, describes the problem as follows: Previously, sample surveys were conducted at regular intervals and validated using statistical methods — a complex, costly process with disputable results. The processing time for revenue sharing ranged from three to five months, in extreme cases up to five years. DB Regio developed a blockchain solution together with DB Systel: Smart contracts are negotiated in advance between transport providers that define the revenue sharing logic. Every ticket can be clearly tracked from purchase through transfer to journey end. Revenue sharing takes place immediately — not only at the end of the month — which improves the cash flow of the participating transport companies. New mobility providers (bike-sharing, ride-sharing, etc.) can be easily integrated into the decentralized P2P network and participate from the first ticket sold. The pilot project was reportedly successfully completed; an extensive market test with various providers was planned. The DB blockchain team was founded in 2018 and now has over 30 employees as well as around 20 use cases in development.

Perspectives

B2B — organisations perspective

Transport associations and mobility providers agree once on smart contracts that define the revenue sharing logic. After that, billing runs fully automatically per ticket — without manual data collection, disputes, or waiting times.

B2C — consumers perspective

Passengers benefit indirectly from smoother travel chains and more attractive association offers, as improved cooperation between transport providers leads to better service offerings. Increased efficiency can contribute to more stable or cheaper fares in the long term.

Employees perspective

Revenue management teams are relieved from complex manual data collection and disputes over revenue sharing. The blockchain makes every ticket and its revenue distribution transparent and immutably traceable.

Benefits

General

B2B — organisations

B2C — consumers

Employees

Challenges

General

B2B — organisations

Employees

Technology foundation

The solution is based on blockchain technology, which acts as a shared and immutable database where all ticket sales are stored transparently and traceably. This technology enables automatic real-time calculation of which transport provider receives which share of the revenues, without the need for manual reconciliations or non-transparent estimates.

Implementation examples

DB Regio Blockchain Revenue Sharing

The current revenue sharing system is non-transparent, inflexible, and time-consuming, as transport surveys do not reflect actual shares. DB Regio wanted to solve these problems with an automated, transparent blockchain solution.

DB Regio is developing a blockchain solution together with DB Systel for automated revenue sharing between transport providers.

The project is driven by the DB Systel Blockchain team, which was founded in 2018 and employs over 30 staff. The team has examined more than 20 different blockchain use cases. The solution aims to replace the previously opaque, inflexible, and time-consuming revenue sharing system with an automated, transparent process.

The solution addresses the lack of transparency in revenue sharing and the time-consuming manual reconciliation processes. It also enables the easy integration of new transport participants into existing association systems.

Tags

Revenue sharing, Automation, Transparency, Smart contracts, Transport association

Sources

  1. Deutsche Bahn und die Blockchain Zukunft