What is API economics?

Author: John Stephens
Date Of Creation: 24 January 2021
Update Date: 27 March 2024
Anonim
APIs 101: What is the API Economy? Part 5
Video: APIs 101: What is the API Economy? Part 5

Content

An application programming interface (API) allows software to interact with heterogeneous applications and services across the network and platforms. As more developers and companies find use for APIs, the term API economics has started to gain in importance, but what do we mean when we talk about API economics and why is it important?

Defining API economics

Traditionally, APIs have been little more than a technical solution to the problem of incompatible software.

The companies have instructed developers to create the equivalent of digital bridges, allowing information to flow between applications that would otherwise not be able to communicate.

Over time, developers have used APIs to break down complex software into containers to improve program efficiency. By segmenting code, programmers can get rid of extraneous software and suggest more direct paths to important data.


This process has led to other capabilities, including the ability to offer third-party users access to specific services and datasets without interfering with critical infrastructure.For this reason, companies can provide a platform for third-party developers to build their own applications and services using APIs to connect to data and function containers. Managing these connections - both internal and external - is what we mean when we talk about API economics.

How the Economy API works

The rise of smartphones, wearables, and other connected devices has resulted in countless apps and services that seem to have become essential to modern life.

From checking maps and weather to booking transportation and movie tickets, we can quickly complete a range of tasks with a single device. But it's not just the hardware that makes this possible - it's also the applications and their underlying APIs that deliver services so painlessly that we rarely even acknowledge how recent all of this is.


For example, when using Uber to book a ride, the company will use APIs to pull your geolocation from a smartphone, place you on a map, and withdraw from a credit card. Throughout the entire process, Uber uses data from various third parties to provide you with its services.

Plus, the platforms themselves aren't just serving Uber. They will respond to any number of API requests from other apps, often providing data at the same time Uber makes its API calls. How effectively these platforms manage this volume of data matters not only to the company itself, but also to its application customers and their respective users.

In fact, the success of the API economy of a company depends not only on its ability to respond to all API requests it receives, but also to do so quickly without negatively impacting its operations.

The future of the API economy

While more and more companies are creating API platforms for application developers, many companies are also becoming platforms themselves.


A great example of this is China's WeChat, a messaging app that also offers so-called mini-programs - third-party services that run in the main app itself. For example, Tesla provides a mini-program on WeChat so that users can find nearby charging stations, and e-commerce firm JD.com allows shoppers to shop within WeChat. As with other platforms, these gadgets use APIs to retrieve data from these services, but the user does not need to open another application or web browser.

As more organizations see the benefits of building their own platforms, developers are likely to find even more uses for APIs and the associated API economies.

New Articles