Roberto Medrano

GigaOm published an enlightening piece [ http://gigaom.com/2012/10/06/business-process-api-ification-the-lego-promise-fulfilled/ ]  by Mayfield Fund partner Robin Vasan, Business Process API-ification: The LEGO promise Fulfilled. As a successful venture capitalist, Vasan brings an interesting perspective to the current thinking about the API economy. It’s primarily because he thinks the API-ification of applications will only truly be successful, and that APIs can only deliver on their promise if there is, in the API ecosystem, the ability to deliver core functionality for all Web-based apps.

Vasan says that the happy outcome of development outsourcing and the dramatic rise of consumable Web services means opportunities which occur at the process, or application, layer and that “brings whole new level of productivity and revenue potential to businesses”.

Looking at the landscape in it’s entirety, one can point to Amazon as the 800-lb gorilla. They’re providing an incredible array of software services, all nicely packaged and ready for use. Their AWS Marketplace is being added to constantly, and it exemplifies what services-based application development and management should be. You search on the solution area you need help with, review the types of services that are offered, and if you like what you see, you pull that into your application. It makes development much easier than doing it yourself, and it’s attractively efficient. But it’s nascent, and it’s lacking to some degree. As Vasan points out, what it lacks are all those pieces that enable a true process; a car has wheels, doors and a steering wheel, but those things along do not a car make. Door locks, airbags, speakers, chassis…to truly make something effcient, and worthy of banking your business on, you need a lot of things you may not even know you need. Until your car (or, well, software application) just flat out doesnt’t work and you realize you have to find alternative pieces to fill in the gaps. As we’ve heard from customers, those pieces aren’t nice-to-haves; they are crucial elements, and when you’re in the business of software applications, those missing pieces are the business process APIs that Vasan is talking about.

It took some time, but the companies providing business process APIs are filling those gaps and are driving the API Economy. While the infrastructure APIs gave us the foundation, these business process APIs are helping actually make transactions work for their intended customers. This is the big difference between the two types, and Vasen points out three key differentiators:

- Simple: these APIs are meant to be added to your application quickly and easily. As the title of his article indicates, there’s the idea of these APIs acting almost like Lego pieces fitting nicely together, irrespective of what you’re trying to build.

- Broad appeal: these APIs won’t be used broadly if they’re too complex and need a super technical developer to understand them. So, correctly, the API providers have given these great appeal to be attractive to developers, irrespective of technical skill.

- Cha-Ching: most of these business process APIs are geared towards transactions, like payment processing or expense management. They will ultimately help with revenue generation because they focus on the types of apps that help companies make and track revenue.

Vasan also takes into account the fact that it’s a lot of upstarts who will possibly have the greatest impact on this market. Small companies with a narrow focus are creating massive opportunities. While Visa is providing the major credit card checkout infrastructure for applications, it’s Stripe and ZooZ who will ultimately give you a functional application. He presents a great list of companies to watch (and profit from), and includes a break-down of API categories.

SOA Software sits nicely in this landscape, as our goal is to enable the overall management and governance of APIs, whether those APIs are infrastructure- or business process-based. We see the API economy [ http://blog.soa.com/the-evolution-of-apis/ ] as participatory and totally democratic, and our products and services [ http://www.soa.com/api-solutions/enterprise-api-management ] represent that. But we also want our customers to be aware of their options and to capitalize on opportunities, so we’ll continue with this blog series [ http://blog.soa.com/ ] and look to bring you trends and commentary that will help you with your development and managment efforts.

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