Extracting Value from Data: The Rise of the API Economy

by   |   January 17, 2017 5:30 am   |   2 Comments

Leon Stigter, Product Manager, TIBCO SOFTWARE

Leon Stigter, Product Manager, TIBCO SOFTWARE

Increasingly, people are choosing to interact digitally with businesses, each other, and even objects. As companies search out ways to make use of the oceans of data being generated from all these interactions, many are opting to explore a business strategy that would have been almost unimaginable just a few short years ago — openly sharing proprietary information with other enterprises.

What’s behind this generous impulse? Profit, of course! Data sharing can improve a company’s bottom line both directly, when access to information is granted for a fee, and indirectly, when data is shared with external innovators who turn it into new revenue opportunities for both companies.

There are many examples of companies that have brought in new referral business, increased customer satisfaction, and improved the flexibility of large, complex systems by embracing data-sharing architectures and cooperating with outside innovators. One classic example is Amazon.

Amazon CEO Jeff Bezos helped spur this movement with a memo he wrote to employees back in 2002, mandating that Amazon teams share data and information with each other ONLY through service interface calls over the network. He banned other, established methods of between-team data sharing, including linking, direct reads, and shared-memory models, all of which he called “back doors.” His vision was to build Amazon on web service interfaces that were designed from the ground up in such a way that they could be shared as needed with the outside world.

The memo ended with the often-quoted words, “Anyone who doesn’t do this will be fired. Thank you; have a nice day!” Today, Amazon’s scalable service-oriented architecture is formidable (and has been leveraged to cultivate the lucrative Amazon Web Services) — affording the company incredible agility and allowing Amazon to move quickly into new business areas.

The best decisions about how to monetize data are built on a sound understanding of how it gets shared, and of the factors that define a sharing platform with the greatest flexibility, security, and longevity.

The basic building block of data sharing is the application programming interface (API). An API is like a contract provided by one piece of computer software to another. An API essentially says, “If you send me a message with x and y information, then I’ll carry out a specific task and respond back.”

APIs began as a business tool operated and managed by R&D and IT departments. Today, they have become so crucial that the term “API Economy” is used to describe how they drive business models and enable new revenue streams, earning attention across every discipline and at the highest levels of many companies.

As APIs have become more business critical, the need has grown for refined platforms that can help companies share their data and information to maximum benefit — both internally and externally — while keeping it secure. A single SMB company may have hundreds of APIs, each one developed to meet a specific business need, and each one in need of management after creation.

To administer all these APIs in various stages and with various purposes, companies are turning to API platforms, often running separate systems for the creation of new APIs and the management of existing ones. However, integration then becomes an ongoing headache. Meanwhile, APIs have become so necessary and common that non-expert developers are frequently charged with creating and managing them.

All of this has given rise to the Zero Code API movement, where teams can start on testing or on creating business logic for an API based only on its specification (and before writing a single line of code). This concept can even extend to a “Low Code” API lifecycle, where you can even start addressing implementation details before serious coding begins.

In a relatively short time, APIs have changed and shaped businesses in so many ways already that it is difficult to predict what will happen next. Forecasts call for about 20 billion devices to be connected to the internet by 2020, with the majority of those connected by APIs. On the horizon are streaming APIs that publish/receive streaming data sets instead of the more traditional request/response operations most deal with now. Additionally, some software products no longer even have an actual front-end, but are driven completely by APIs to be used by other products.

Data and the way it is shared has become the bedrock of digital business. And most of the data generated – with all its direct and indirect revenue potential – is and will be connected by APIs.

 

 

Leon Stigter, Product Manager, TIBCO SOFTWARE

Whatever industry you’re in, there are streams and streams of data whizzing in and around your business. Within those streams, there is information that is crucial to your business. Finding that key piece of information can be challenging when you store all of that data, but leveraging the TIBCO Digital Business platform allows businesses to find that key piece of information while the data is in motion. As part of the Global Product Presales team, Leon specializes in helping business unlock the value of their data by making sure to get the right piece of information to the right person at the right time in the right context.

 

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2 Comments

  1. Posted January 22, 2017 at 1:48 am | Permalink

    Great article with real world examples. Thanks Leon

  2. Anjolaiya Oladipo
    Posted February 2, 2017 at 2:34 am | Permalink

    Generating innovative creation and building of solid datawarehouse through API’s helps in driving any business forward. The loads of value lockes in an industry set of data can not be overemphasized…Wonderful piece of insightful information Leon!

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