Do You Have an API Economy?

APIs have been around a long time. Not sure what an API is? The Next Web is worth reading on this…

As ever Wikipedia has a good answer: ‘In computer programming, an application programming interface (API) specifies how some software components should interact with each other.’

Sounds straight forward, or is it? Of course as is usual in the software world there are a number of different languages and schools of thought which we do not need to worry about here.

This might sound a bit geeky so what is the relevance to the real world or indeed the public sector?

Guess who is one of the biggest user of APIs? Its Amazon.

Internally all their teams create products that interact with other teams via APIs. This serves a number of purposes – it is a business tool to help Amazon build its own organisation in a modular manner – it’s a kind of plug and play. As a by-product these APIs are in effect being tested internally. If an API is seen to have a wider value it is made public to the outside world and this allows us as consumers to use the data either directly or indirectly.

But what is an API really? How about calling it a data stream that is documented so that others can use it. For example at the NAO we could make an API of a list of report publication dates, report titles, audit topics – this list would update as more reports are published. Someone in the outside world could then tap into this data stream and feed it into their own website or merge it with related data.

I have been to a couple of talks recently which brought home why people talk about an API economy.

There were two companies who generate significant portions of their revenue via APIs. For example an online music store with 22 million tracks is built on numerous APIs that feed the data they hold on all these tracks in different formats. Holidays Extra is another site built around APIs. One of their developers explained how recently they released a set of APIs and in a short time a whole ecosystem grew up around it using their data generating the kind of ideas and use of data that they would never have thought of themselves. Indirectly this led users back to their content and generated new revenue.

If you want a bit of fun Tesla the car company has just released some of their information as an API If you take a look you can see that by releasing this data it has allowed external developers to start building new applications based on this information.

Or look at the Transport API if you want to see how an API economy can develop. The team pull together lots of different data sources, add value, and charge above a certain level for usage of the APIs.

Ok so that’s the private sector what about us in the public sector. Well take a careful look and you will see that orgnaisations like the Office of National Statistics or DVLA are starting to release APIs. Why because they want others to use the data that they have collected; in some situations there could also be revenue generating opportunities.

So if you have a good data source or something that could be turned into an data source there might be some mileage in considering creating an API. You never know before long you might have your own API economy.

Nick Halliday is part of the GovLoop Featured Blogger program, where we feature blog posts by government voices from all across the country (and world!). To see more Featured Blogger posts, click here.

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