API Economy

Overview [1]#

API Economy is a term applied to the usage of Application Programing Interface (APIs) act as the digital glue that links services, applications and systems.

API Economy allows businesses to make the most of their data to create compelling customer experiences and open new revenue channels.

To provide an example, think about these statements: [2]

  • Uber, the world’s largest taxi company, owns no vehicles.
  • Facebook, the world’s most popular media owner, creates no content.
  • Alibaba, the most valuable retailer, has no inventory.
  • Airbnb, the world’s largest accommodation provider, owns no real estate.”
These companies are indescribably thin layers that sit on top of vast supply systems ( where the costs are) and interface with a huge number of people ( where the money is).

The New York Times needs to write, fact check, buy paper, print and distribute newspapers to get their ad money. Facebook provides a platform for us to write our own content, and Twitter monetizes the front page of newspapers, which happens to now be the Twitter feed.

Our relationships are no longer with the original content Service Providers.

The value is in the software interface (API), not the products. It’s not just the smart home. Uber provides average cars in a premium way; Seamless makes the most disgusting of greasy kebab joints appealing and makes its margin from both sides. iTunes for many years took virtually all the profit made in the entire music industry by being just the thin software between the hard work making tunes and the money selling them.

More Information#

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