The possibility for creating new revenue streams and business models using open application programming interfaces (APIs) is capturing the attention of business leaders.
Kevin Pool, regional chief technology officer of TIBCO Software, says: “What’s unique about open APIs is that they are business-led initiatives designed to create new market opportunities, grow the top line and expand brand and market reach in new ways.
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“For example, the NSW government offers real-time transport information via an API, allowing numerous mobile apps and other services to be constructed for the advantage of all,” Pool says.
“The API management market is forecasted by industry analysts to grow rapidly, becoming an essential enterprise technology within the next few years.
“Developers who incorporate functionality into their applications using open APIs, will have a significant time-to-money advantage over traditional application development approaches.
“It is much simpler and faster to access and leverage business functionality when it is exposed as an open API. By providing a public-accessible API to their services, businesses and their customers can take advantage of what others can build on them, rather than needing to build it all themselves.”
The drivers for the API economy are somewhat different from what has traditionally been seen for the enterprise, and represent the convergence of several market and socioeconomic trends. They include new business models, mobile device explosion and a new generation of tech-savvy employees entering the workforce who see open APIs as a tool for building a new style of applications.
“A good API management solution must meet the needs of many different parts and players. As you consider whether the time is right for you to make this move there are some questions that should be asked,” says Pool.
Seven questions to decide whether open APIs are right for your organisation
1. What data or application functionality could I expose to existing business partners, channel partners or suppliers that would make it easier to do business with me?
2. Where can I take cost out of my supply chain by enabling more self-service and flexibility in how suppliers interact with me?
3. How can I use open APIs to create competitive differentiation and deliver additional value to my customers?
4. Would it make sense for me to repackage my existing subscription offering for data or media products as a collection of fine-grained ’micro subscriptions’, monetised via APIs?
5. What new routes to market or business partnerships can I potentially create by exposing data or application functionality with public APIs?
6. Does my mobility strategy include an open API element as a way to leverage growth in mobile devices and expand my brand exposure?
7. How can open APIs used by external developers help drive product innovation and out-of-the-box thinking within the company?
Image credit: Flickr/caveman_92223