Forrester calls the API the digital glue holding our world together. Forbes says it’s the key to unlocking the digital economy, while TechCrunch predicts it’ll unlock the data economy. And, here at Nordic APIs, we’ve told you how the API is the driving force behind smart cities, the Internet of Things, and more.
“APIs are touching pretty much every part of your lives, how you get ahead in business, getting data. You’re going to need APIs,” API Evangelist Kin Lane told Nordic APIs. Whether we realize it or not, Lane argues that APIs have completely disrupted the consumer psyche. He says the API is teaching us lessons about how to be social, offering examples starting back with Flickr and Del.icio.us and moving into the more mainstream oversharing of our lives on Facebook and Twitter, and to how APIs have enabled us to professionally collaborate from anywhere.
Lane takes it a step further by saying that the API is the enabler that has allowed us to move our lives fully online, including, “our banking, photo storage, our music. All of this is enabled by APIs and the cloud. Our finances, how we trade stock, manage giftcards, payments with currencies, social, cloud commerce.”
It seems that the business world has finally realized what those in the back end have known for awhile — the application programming interface is no longer the future of our connected world, it’s the current reality. In fact, APIs’ growing popularity is even being analogized to what websites were back in ‘97: most companies use them and almost the whole public is interacting with them, without quite understanding what it is or its value yet.
API Indicator #1: API Becomes an Accepted Tool to Grow Your Business
“APIs allow businesses to liberate their data, and monetize it,” said VP of Innovation at Axway software Mark O’Neill.
When it comes down to it, an API isn’t the magic recipe for growth and not every business needs an API. “Can we pay for this?” has become the most important question when debating whether or not to develop. That being said, more and more businesses are finding ways to use the API as a fast solution to internal and customer needs.
“The future of APIs is that every call you make is driving transactional value for the provider of that API,” explained John Sheehan, founder of Runscope API performance monitoring tool, and previously of API-driven apps Twillio and IFTTT. “People should focus more on building business value than focus on building the API value. Find the underlying business value and how you can augment your API for it, not try to find a business value for your API.”
- How do I make money from this?
- Who is it for? For me? My partners?
- If I open an API, what is the core value I am offering?
- Is it secure?
- How do I use it myself, in our own apps and services?
- How do I justify the cost and effort? Are there multiple ways I can get ROI on this?
For Musser, the future of the API for developers is simple: “To save money, make money, be more agile, to disrupt a new industry.” He says that Twilio Integration as a Service (IaaS) is really the best example. “These companies are API-first. These whole businesses are based on providing services to developers.”
He continued that “businesses need to look at APIs not as APIs, but as a conduit. Why am I doing it and who is it for? Am I doing it to make money? To save money? For broader reach? Partnerships?”
O’Neill shared some great examples of traditional businesses expanding via APIs, including Abe Lincoln’s former employer Dun and Bradstreet who created a new revenue channel by offering their data to Software as a Service (SaaS) like Salesforce, as well as newcomer electric company First Utility. “They enable customers to easily switch from incumbents to First Utility, though switching websites like USSwitch.com which call their API to receive quotes and sign up for service,” disrupting a 100-year-old industry.
API Indicator #2: Microservices Architecture Allows All Departments to Scale
We’ve already covered growing trends for designing APIs for the developer experience, but we need to remember that integrators and developers aren’t the only users of the API. There’s a broadening trend that backroom developers are actually focusing more and more on how to solve the needs of other departments more quickly.
The increasing popularity of microservices architecture is allowing developers to become more agile in their software update releases, as building smaller, more contained features allows for shorter development cycles and shorter distance to market.
Through trends like microservices, APIs are becoming the final puzzle piece to building organizational-wide digital strategy, as the API comes out of the IT department and into the board room.
For example, APIs will continue to enable marketing and market research firms, and among other non-IT business areas, to use APIs to create short-term solutions or situational applications that serve as answers to short-lived problems.
API software consultant and founder of LaunchAny James Higginbotham calls this the concept of short-term application development:
“Businesses often times have the need for a very short-term application to be built, primarily around the marketing space. Marketers often run very short burst campaigns that require a micro-website or a micro-application. If businesses realize that APIs are not necessarily a technology solution but it’s a way to implement componentization of organizations, then the business side can use these APIs to construct these short-lived applications to achieve what they are trying to achieve — marketing, internal reporting, project timelines and [other] requirements.”
This all fits into a broader necessity for APIs being created to enable businesses to respond rapidly to changing customer needs, as well as internal ones. Higginbotham even says you may not even need to sell the term “API” to that marketing team, but rather sell a faster solution to their needs. “IT often runs on a longer cycle, even in the agile world,” he said, which leads to a clash with campaign-driven marketing departments. With APIs, “the marketing department doesn’t have to work with IT, they actually become the part of IT.”
But this movement away from the monolith structure isn’t just going to help outside the IT department, but help software scale as well, allowing different parts of systems to work independently, reducing time to market and to resolve errors.
Sheehan echoes Higginbotham:
“I think the future of APIs is a more concerted effort of companies of all sizes to really build out the SOA [service-oriented] architecture we dreamed of ten years ago but didn’t exist. I think that managers in the long run will find the flexibility to make them more responsive to business needs. [At Runscope] we have lots and lots of small services. It really has allowed us to focus on new features and scaling…allows us to kill off features, to rewrite entire components, without letting it affect the entire system.”
When asked what should be the priority focuses for excelling the API space, O’Neill continues with this sentiment:
“It’s important that APIs are linked to the rest of enterprise architecture. They should not be air-gapped away… Excelling in the API space means ensuring that your API is not a “science project”, but instead is part of enterprise infrastructure, from Day 1.”
When it comes down to it, what’s important is finding the way to make changes faster and to respond to more business needs as “the business changes faster than we could ever develop our software.”
API Indicator #3: Are Public APIs Losing Their Luster?
The wave of Public APIs is ebbing. What was once a hot trend doesn’t make sense for a lot of companies and can actually risk your good name if done too hastily.
While most of us are as enamored with the idea of the Public API as we are with open source, as Sheehan puts it, “we always thought that the most interesting API data wasn’t happening in the public or the API economy.” When it comes down to it, internal APIs may inevitably carry more valuable data.
Musser rightfully calls Netflix the poster child for APIs. Indeed, the cable company’s biggest threat has an entirely internal API-based business model, “but they’re not trying to go to hackathons to have every developer use it.”
Does a company need a Public API? If you’re a Twilio or Clarify, where your API is your business, then absolutely. But otherwise it must be remembered that an API is one feature among your overall product offering and thus, as with all features, a cost-benefit analysis must be made.
As Musser puts it, “Open API is one flavor, one strategy, but it’s by no means the only or necessarily the best strategy. It depends who you are, what you’re trying to do, and it’s a mistake to sort of jump to that conclusion” of an opening an API too early.
It doesn’t mean your API can’t go public one day, it’s just that it’s a risky move on the first day. “Think of APIs as an evolution. I think it’s quite natural to start off as having an API as an internal API and later you open it up to partners, and then, after that, a broader set of partners, and then later anyone,” Musser mused:
“You don’t have to boil the ocean from day one.”
To hum the same refrain, the secret to API success is knowing why you are creating it. Ask yourself: What’s its purpose? Why would it need to be public?”
Higginbotham agreed with Musser by saying, “I’m seeing more organizations desiring to build internal APIs, particularly larger organizations that are using Private APIs because they are still trying to understand how much they want to release to the public.”
However, he contends that “the best of programmers are modeling their APIs after Public APIs, in case they want to release it.” That means that security is a priority from the start, which of course is a wise practice, whether it ever goes public or not. “I think over time, we’re going to see more of these Private APIs beginning to emerge” to the public, Higginbotham said, but that they will be coming from APIs that were internally purposed but externally minded from birth.
And while public APIs are hot, in the B2B space, there’s always been what O’Neill calls “Dark APIs”, like dark matter because it’s happening all around us, but we don’t see it. “Perhaps B2B APIs they don’t have the hype of fully public APIs, but they are generating very significant revenue.”
Of course, another strike against Public APIs is that it can be a public relations gamble. “I believe the more security conscious these organizations are, the less likely they are to start with Public APIs,” Higginbotham warned.
Lane is inclined to disagree with his API colleagues. He doesn’t believe that having a Public API puts you at a greater risk—because nothing is hacker proof and somebody will eventually find a way to reverse engineer and build on top of it.
“Hiding something is no security strategy. Security through obscurity is no security strategy.”
Lane believes that you must have a well-defined API strategy, offering the example of Twitter, which often frustrates developers with security constraints, but nonetheless is a tool that prioritizes its users’ security.
Plus, he argues that another positive of publishing a Public API is that you’re automatically thinking more about OAuth and user credential security, which will make future growth more easy.
While there is a growing trend of companies pulling back from huge Public API campaigns, the jury is still out if Public or Private APIs will win the future.
Are You Getting the Most Out of the Future of the API?
If there’s a theme to draw from the insights our API fortune tellers bring, it’s that the API isn’t for everyone and, like with all things, you need to examine your needs and see what works best for a profitable and productive solution. However, as a developer, we hope we’ve empowered you with a glimpse into the future of APIs.
Let’s review just what that future looks like:
- APIs allow businesses to become more agile.
- Microservices architecture helps meet users’ demands at a quicker pace.
- A Public API is not your first move. Private APIs and Partner APIs are more logical to consider before opening yourself up to the world.
Are you ready to be a part of the future of the API space? What better way than joining us at one of our stops during the Nordic APIs World Tour this May? Join the debate of the future of APIs in Munich, London, Copenhagen or Seattle and become that future yourself!