3 Experts on How the API Industry Is Changing Posted in Business Models Thomas Bush October 1, 2020 How is the API space evolving in 2020? With every new year, we see many changes in the API industry. And it’s not just how we build APIs — like which architectural styles we use — but what we build and why we build it. This article looks at how the API space is changing across six core focuses: industry trends, regulations and standards, adoption, event-driven APIs, COVID–19, and careers. To help identify what’s happening in the space and why it matters, we’ve consulted three top-tier API thought leaders: Derric Gilling, CEO at Moesif Amancio Bouza, Principal API Consultant Emmelyn Wang, Global API Strategist API Industry Trends Question: What are the most exciting API trends right now? Amancio Bouza, Principal API Consultant In terms of core industry trends, Amancio comments on the growing popularity of API-driven product ecosystems, also known as platforms. He’s particularly curious as to just how proprietary these ecosystems will be: “Traditional organizations are taking business ecosystems more seriously…Competing ecosystems are not built technically, but from a partner perspective. We’ll see if the fight for ecosystems leads to open ecosystems or monopolistic, winner-takes-it-all ecosystems.” Meanwhile, Derric and Emmelyn see a rapid rise in the number of API-first businesses. No longer to be seen as a “reference architecture,” Emmelyn says APIs help connect business operations in — and outside — of the organization. She hints at a resulting change to the very nature of digital sales: “APIs are at the forefront of business and partner discussions to tightly drive activities. Activities include gaining insights into the end-to-end way digital products and services are sold and used. In addition, the 200-year-old sales funnel model is challenged.” Derric also acknowledges this shift in sales, explaining that APIs are “enabling entirely new go-to-market strategies,” disrupting industries like payments and logistics. Concerning this new business model, he adds: “API-first companies look different from traditional B2B companies running a top-down sales process. Instead of sales pushing the product to hit growth targets, the product itself, and the surrounding brand and content attract developers to adopt.” Regulation and Standards Question: How have standards like GDPR and PSD2 affected the API ecosystem? Do you foresee any other regulations, directives, standards, or initiatives heavily shaping the API economy in the coming years? Derric Gilling, CEO and Co-Founder at Moesif. Read his latest posts on Nordic APIs. On the issue of regulation, Derric focuses on the practical impacts of data protection regulations, as concerns the API provider. In particular, regulation has introduced some new complexities to the practice of logging: “GDPR and CCPA require new procedures for things like API logs, which are used across the company from security teams to business teams. You can no longer simply dump API logs into a log management solution. Instead, API businesses need a way to export and delete (or anonymize) all the associated logs and events specific to a single customer. This means API logs have to be tied to some permanent user identifier (and not just API keys which are rotated).” Amancio is looking at the issue on a deeper level, asking why governments are introducing these standards and what effects they are having on the consumer: “Governments are introducing more and more directives and regulations to help customers switch seamlessly between [for example] insurance providers. I see governments facilitating less friction in markets and reducing lock-in, especially regarding customer information.” As a direct result, he has noticed that organizations have to be much more “careful and conservative when publishing customer-related data.” Adoption Question: How can we accelerate the integration of new APIs? When it comes to making API adoption upfront and easier, Amancio sees promise in two solutions. The first is Hybrid Integration Platforms (HIPs): middleware solutions that simplify application development, testing, deployment, and maintenance. The second is a change in API development mindset, which focuses on products, and not projects: “With a project-based approach, there is no real answer to maintaining API integration and using quickly evolving APIs.” Emmelyn Wang, Global API Strategist Emmelyn shares a similar idea, instead referring to the importance of an effective process, where API development is an iterative cycle, and not a one-off sprint: “Getting back to the basics is critical to a strong foundation of APIs. The more organizations focus their time upfront on the iterative process of designing value, such as using the APIOps Cycles methodology. The more they’re looking at key operational metrics, the more you can tighten the cycles of design, development, and releasing game-changing APIs that are serving the right level of integration needs.” Messaging Question: What tools, frameworks, and trends are you looking out for in the world(s) of event-driven and messaging APIs? AsyncAPI is becoming a significant initiative in the event-driven API space. However, a sentiment shared by both Derric and Emmelyn is that more needs to be done to ensure both tooling and vendors offer greater support for AsyncAPI specifications. Emmelyn points out the OpenAPI Specification as a reference point: “As an earlier contributor to the AsyncAPI initiative, the community continually seeks to iterate on tools for companies and organizations to adopt the specification as widely as the OpenAPI Specification.” Interestingly, Derric likens the current state of AsyncAPI adoption to what was once seen with GraphQL: “Right now, event-driven APIs are still in the early days in terms of tooling, which makes them hard to use outside of specific use cases like chat and real-time games…This is very similar to the preceding GraphQL wave where there was not much tooling available (like caching and authentication) to productionize an event-driven API. I’m super excited to see where database companies and cloud vendors can take this.” Continuing on the topic of asynchronous API specifications, Emmelyn adds that there is also the “need for additional ways to document event-driven and messaging APIs beyond the core machine-readable spec.” Offering a different take on the matter, Amancio comments on the new business opportunities created by event-driven architectures: “Cars on the road can provide a data stream used for car insurance for pay-as-you-drive. Personalized marketing shifts from campaign-driven or demographics-driven to event-driven. A 360 view of the customer aggregates not only customer-related info but also the customer’s current situation and needs.” Additionally, Amancio says that the inflood of new, fine-grained data points from event-driven architectures will increase the need for data engineering solutions, which are often needed to clean and make sense of large data quantities. COVID–19 Question: Have you noticed any repercussions in our field from COVID? Switching gears to a topic that’s perhaps most current, we asked our panel about the impacts of coronavirus on the API industry. Both Emmelyn and Derric recognize an increased demand for digital services. Derric points explicitly to the logistics sector and workflow automation as examples: “We’ve seen the API industry boom in a way due to COVID, especially in sectors like logistics and workflow automation as businesses had to shift to a new reality quickly. The downside of all this is that many businesses did not have tools and processes in place to handle the record-breaking shift to online. Companies are rushing out new online experiences, yet may be the first time exposing APIs to the internet. If they are relying on legacy systems and don’t have dedicated API security and observability products in place, it can backfire as a new breed of threats that target APIs specifically.” Interestingly, despite both mentioning an uptick in the API industry, Derric focuses on the risks of overly fast service rollouts, where Emmelyn discusses the need for additional talent: There is less employed talent to do the critical work, yet there is far more work in our field required due to accelerated workloads and demand for new digital approaches for businesses to survive. Also read: Top API Security Threats In 2020: Expert Panel Interview Careers Question: For those looking to build a career in APIs, are there any particular areas that you feel are underserved or rapidly expanding? Careers-wise, Emmelyn highlights three sets of roles in the API-driven organization that are more important than ever. They are: C-Suite with the foresight to support API products and programs from the top-down. Consulting partners to augment professional services and scale their expertise to pair with relevant tools. Workforces with talent in Enablement, Integration, and Instructional Design that pairs with scaling Value Proposition Messaging. Derric and Amancio add to this list, saying that API product managers, mediators between business and technical circles, and data specialists, are all continuing to prove invaluable roles. Final Thoughts The API industry is changing in a handful of ways. Not only are APIs changing the very nature of businesses, like how they sell and whether they are product or ecosystem-oriented, but there are new architectural styles — like event-driven ones — which are creating even more possibilities. Enabling fast API adoption is increasingly important, and our experts agree this starts with viewing APIs as products with ongoing development and support. Government regulations and COVID–19 may be introducing new constraints to the API industry, but it’s stronger than ever, and demand for the right talent may be at an all-time high.