The API Economy Delivers Limitless Possibilities

This is the conclusion of our series What Are APIs and How Do They Work?

Making certain functionality--be it the results of a database query or interactive functionality like a map--available via API dramatically changes the way that software technology and information can be delivered to the market. In the 1990s, for example, an organization that wanted to run a customer relationship management (CRM) system had to lay out huge expenditures on software, hardware, CRM specialists and training. But, using the power of the cloud, CRM providers like Salesforce.com completely disrupted that model. Instead of the traditional, expensive approach--whereby a CRM vendor sprinkles hundreds or thousands of stand-alone installations across all of its customers--Salesforce.com essentially has one installation connected to the Internet that all of its customers share. This idea of sharing a common infrastructure across your customers is called multi-tenancy. 

At first, the customers of Salesforce.com used their Web browsers to access and share the CRM provider’s common infrastructure. But it wasn’t long before those customers were granted API-level access to Salesforce.com’s functionality. This enabled customers to incorporate key pieces of the CRM system’s functionality--for example, the ability to look up a customer’s history--directly into other applications. Salesforce has reported that more than 60% of all the transactions with its application tier are API-driven transactions. In other words, more than 60% of the transactions that traditionally would have happened through Salesforce.com’s browser-based user interface are instead happening in the context of non-Salesforce applications that take advantage of the data or functionality in Salesforce.com by way of API. 

For Salesforce, the implications of this trend are quite staggering. But the implications in terms of the role that APIs are beginning to play when it comes to the delivery of technology to the market are even more staggering--and the impact that cloud-based multi-tenant systems are playing in the arc of this trend is equally significant. As a result, thousands of companies and organizations are pivoting their strategies to deliver their value propositions as technologies via API. Further, hundreds of companies that offer only technology via API are spinning up. 

IBM, for example--a company that once depended almost completely on the on-premise installation of its technology—has amassed a portfolio of cloud-based technologies that it’s commercializing and delivering to the market via API under the Watson brand. In the first quarter of 2015 IBM enhanced that portfolio by acquiring AlchemyAPI, one of the new breed of smaller, API-only companies.

The API economy now spans thousands of API-providing companies across hundreds of categories. Within each category there are multiple offerings, all competing for the affections and money of third-party developers--any one of which could unleash the next API-consuming Zillow, Instagram or Uber. 

We at ProgrammableWeb track as many APIs as we possibly can in our API directory, categorizing them according to any number of the hundreds of the categories that we’ve observed over the years (such as Payments, Social, Weather, Mapping, Government and Crytpcurrency). Not a day goes by that we don’t discover another bunch of APIs to add to our directory, and we’re identifying new categories of APIs all the time.

And that’s just the APIs that are in plain sight. There are some APIs that we haven’t yet discovered but that are available from across the Internet, but there are other, private APIs that live on corporate networks belonging to companies that are very forward thinking in their application development methodologies. While they are not making their APIs available to third-party developers, they have recognized the power of loose coupling and componentization that APIs make possible. These companies are reaping—or will surely one day reap--the benefits of moving to an API-driven business.  

David Berlind is the editor-in-chief of ProgrammableWeb.com. You can reach him at david.berlind@programmableweb.com. Connect to David on Twitter at @dberlind or on LinkedIn, put him in a Google+ circle, or friend him on Facebook.
 

Comments

Comments(31)

aashgill

Really a good explanation for API What, How,When and Where to use API... 

Thanks!!!

cmci

Great API intro and very interested to note you mentioned UBER's potential risk, I projected for some time and confirmed after watching recent news of severl new global entrants to their market space.

Also, I watched SalesForce emerge and their first HQ's in San Mateo, CA was in office space a huge Japanese company had previously leased, then gave up, when I declined to continue with them.

Presently I'm researching the competing API Payment Processors and the related Cyptocurrency ones.

david_berlind

Thanks @cmci for the great compliment. I'm not sure I mentioned Uber's potential risk as much as I cited the company's apps as a consumer of APIs.  But no company is completely safe, is it?

Srish

Nice piece all the way ....but the start was a bit confusing !!...it would have been better if the intro would have more precise

david hyman

Hi Excellent descriptions and very helpfull. How can API be controlled so that if I wanted a private connection between say a HR SaaS tool and an inhouse service desk? Currently  a manual operation exisits between the two introducing typos in names.

I suppose my question is how secure are API connections?

David

david_berlind

You are correct in that your real question is "how secure are API connections?".. but the more precise question is how secure is the HR SaaS tool provider's connections. You need to ask your "candidates" what they do to best secure the communication.  For example, starting with protecting the connection with HTTPS.. but there are also other questions like: How do they store data at rest (is it encrypted). Do they offer a VPN option that essentially puts your "partition" of their multi-tenant architecture behind your firewall, .. and so on.

david_berlind

You are correct in that your real question is "how secure are API connections?".. but the more precise question is how secure is the HR SaaS tool provider's connections. You need to ask your "candidates" what they do to best secure the communication.  For example, starting with protecting the connection with HTTPS.. but there are also other questions like: How do they store data at rest (is it encrypted). Do they offer a VPN option that essentially puts your "partition" of their multi-tenant architecture behind your firewall, .. and so on.

jnse23

This is by far the best explanation I've received ever about API's.  David Berlind made a genial work with this tutorial. I was just looking at refresh the meaning of the word API an ended reading the whole article, but not only that. Now I have the idea of developing a proposal of "moving to an API-driven business". Wow, David, congratulations! you're genial!

david_berlind

thank you so much for the compliment. it is greatly appreciated and we have more content like this in the works. hopefully, you will find it to be equally useful.  Thanks.

David

Eddie Griffin

Great read. I am a novice programmer and found the info in this article very valuable in understanding

how programmers and developers are getting their work done. Really thought provoking. Thanks

david_berlind

Thanks Eddie. I greatly appreciate the compliment. Comments like yours are very motivating to me and the team hear at ProgrammableWeb.  We're glad you're enjoying the content and keep in touch!

K.Muralitharan

Thanks a lot for a great intro on APIs. I am learning android devolopment thro' UDACITY and found a link to your website. Thanks to your simple example of an electrical wall socket the whole subject is  clear.. Thanks a lot once again / Muralitharan

visionj

This is one of the best blog posts ive read in a while.

I'll be coming back here often!

david_berlind

Thank you so much @visionj for your kind words. We love getting feedback like this and hope to hear from you again! Let us know how we're doing.

David 

momo786

Wow - all of a sudden I feel enlightened 

thanks

david_berlind

Hi @momo786.. we're super glad that our content was able to englighten you on the topic of APIs.  Thanks for the kind words!

brucekjeff

Great read! Hopefully this comment goes through as my last seems to have failed. I had been searching around for a few hours for a better explanation of API purpose and a more exact description without finding much that gave me a good understanding. Really appreciate you writing this, it helped me a lot and I feel I understand it much much better now and could explain it to someone else. Keep it up!!

david_berlind

hi @bruce and thanks for being a ProgrammableWeb reader. The team here at ProgrammableWeb is of course very happy to receive compliments like and so we greatly appreciate the feedback. We're glad that our content was able to help you better understand the purpose of APIs. Please keep the feedback coming! It really matters!  Thanks again.

gerardbyrne@lineone.net

Brilliant article on APIs. As a educator it has provided me with excellent information. I read many articles and this is easily one of the best I have read, easy to follow, well written and got examples.

 

Thank you

david_berlind

Wow Gerard! What can I say to a compliment like that. Thank you so much. I'm glad you found it to be so valuable and hope to bring you more content just like it in the near future.

Azam Ali

Great explanation. One of the few articles that I have read in its entirety including comments.

Any recommended links for developing APIs and using APIs for developers (using Python)?

active-bus

Very Nice Good Explain Great API intro and i am very interested about api thaks 

david_berlind

@active-bus, thank yo very much for the kind words. Glad you found our explanation to be useful and we look forward to getting more feedback to you in response to our other API University content!

david_berlind

Hi Reece, thanks very much for the compliment. Greatly appreciate the feedback and glad that you are enjoying the content.

davidbv2

I am currently in a coding bootcamp to become an entry level Java developer at an IT traning startup company called Grand Circus in Detroit and I was just introduced to APIs on this past Thursday. I began researching more about APIs and came across this article series. I just shared it with my class! This is a phenomenal read and I look forward to more article additions to this series. Just become a member as well. Thank you David and the Programmable Web Team!

david_berlind

Hey DavidBV2, 

Thank you so much for this equally phenomenal feedback. The team here is very excited that you felt so strongly about our content that you shared it with your entire class. So great to hear. Please keep the feedback (good or bad) coming and we wish you all the success in the world as you continue your developer journey with Java and other languages!

David & the Team

Jalal-Shaibani

"Simplicity is the ultimate sophistication" as Leonardo Da Vinci said, a very nice & easy explanation of Web API after two days search on the internet. 

david_berlind

Thank you Jalal. We tried to simplify it as best we could. Glad that our explanation worked so well for you!