Incredible Opportunities Offered by the API Economy
February 03, 2016

Sven Hammar
Apica

API (Application Program Interface) is becoming a buzzword in the IT world. According to Wikipedia, API is "a set of routines, protocols, and tools for building software applications." For a more appealing definition, let us ask IBM, which describes the API economy as "the commercial exchange of business functions, capabilities, or competencies as services using web application programming interfaces."

The Internet makes it possible for devices and people all over the world to be connected, whereas APIs utilize hardware and software to exchange information over those connections. As organizations and the public continue to grow more comfortable with implementing API technology in day-to-day activities, the market for API products continues to expand.

In my view, the API economy not only offers incredible opportunities to explore new ways to interact with devices and services, but also allows innovators to put a new spin on solving old problems.

The API Economy in Action

If you used your Facebook credentials to log in to a Disqus comment board today, or used a Google maps widget to locate a store you are visiting later, you have already used two different APIs. APIs are also helpful beyond web browsers. For example, if you ordered more Bounty paper towels this morning with an Amazon Dash button, or turned down your home’s Nest thermostat from work using a mobile app, you are already familiar with Internet of Things devices running APIs.

The "Push for Domino’s Pizza" button – which is reminiscent of the 2014 app created by a group of New York City teens called Push for Pizza – allows a customer to get his or her favorite pizza order delivered to their door in one simple step.

Succeeding in the Data Economy

APIs used to be developer tools, but now they are a business model driver. Your products and services can be reworked and implemented in inventive ways to generate new revenue streams. Succeeding in the API economy is essentially the same as succeeding in the data economy—and many businesses find it helpful to treat the API itself as the new product. This may seem a bit unusual since the API shares a lot of assets with another product, but both need to stand alone. Google Maps and the Google Maps API, for example, are two different products that share some of the same primary services.

A well-implemented API will expand on an existing product or concept, which in turn will seize new business growth opportunities. As a general rule, an API should improve performance — making it easier, for instance, for a business to include a map on their website, or for a homeowner to fix thermostat settings remotely.

However, APIs require a solid, reliable Internet infrastructure. If that IoT thermostat does not get the message that it should turn off the air conditioning because the server that handles the communication is overloaded, the customer will be less than thrilled. Latency is also important: The communication needs to happen quickly or the customer may give up. Load testing services are essential to making sure your infrastructure is ready to handle communication for your API.

Play Well with Others

APIs are built around the concept of communication and should streamline a specific process with the goal of extending your business to the widest possible audience. Your business may also be on the receiving end of help from another organization’s API. For example, if you were designing a video streaming service aggregator app for phones and tablets, you would work with APIs from services like Netflix, Hulu, and Amazon to gather data on content available on each service.

The flip side of pulling in data from multiple sources is that an API typically has to interact with multiple endpoints. For example, the hypothetical IoT thermostat would not only need to work with iOS devices to reach its full audience, but also on Android devices, Windows Phone devices, and desktop web applications.

A well-implemented API is seamlessly integrated into day-to-day activities and environments. When someone sees a Google Maps widget on a store website, they should not see it as an API, but as a convenient offering that enhances their experience.

An effective API Economy strategy addresses what the audience wants or needs — and, most importantly, enhances their experience.

Sven Hammar is Chief Strategy Officer and Founder of Apica

The Latest

January 17, 2019

To better align business and IT objectives, enterprise organizations should focus on the core "problems" that individual business units face today in driving out real consumer value. Until the roadblocks and inhibitors — and, ultimately, the resultant technical debt — are removed from the equation, large enterprise organizations will continue struggling to succeed ...

January 16, 2019

Technical debt is what results when legacy platforms or highly integrated and dependent systems and processes inhibit large enterprise organizations from meeting the needs of internal business stakeholders. In many cases, the core objectives that drive real, monetizable business value are not aligned to the esoteric IT goals of "automation" and "Agile development." This creates a fundamental disconnect between business and IT ...

January 14, 2019

Budget season is an important time of the year for businesses because it gives senior IT and security leaders time to reflect on what went right this year and what initiatives need to be given priority in the new year. Recent research from Threat Stack shows security budgets are expected to increase by 19 percent over the next two years, but business leaders are still facing challenges determining where to allocate this budget in the face of rapidly evolving infrastructure ...

January 10, 2019

As organizations of all sizes are embracing hybrid and multi-cloud infrastructures, they are experiencing the many benefits of a more agile, distributed and high-speed environment where new applications and services can be built and delivered in days and weeks, rather than months and years. But as the adoption of these next generation architectures continues to grow, so do the complexities of securing the cloud workloads running on them ...

January 09, 2019

DEVOPSdigest invited DevOps experts for their predictions on how DevOps and related technologies will evolve and impact business in 2019. Part 9, the final installment, covers microservices, containers and APIs ...

January 08, 2019

DEVOPSdigest invited DevOps experts for their predictions on how DevOps and related technologies will evolve and impact business in 2019. Part 8, covers microservices and containers ...

January 07, 2019

DEVOPSdigest invited DevOps experts for their predictions on how DevOps and related technologies will evolve and impact business in 2019. Part 7, covers the Cloud ...

December 20, 2018

DEVOPSdigest invited DevOps experts for their predictions on how DevOps and related technologies will evolve and impact business in 2019. Part 6, covers DevOps Analytics, including AI and Machine Learning ...

December 19, 2018

DEVOPSdigest invited DevOps experts for their predictions on how DevOps and related technologies will evolve and impact business in 2019. Part 5 is all about testing ...

December 18, 2018

DEVOPSdigest invited DevOps experts for their predictions on how DevOps and related technologies will evolve and impact business in 2019. Part 4 covers Agile, CI/CD and automation ...

Share this