A Simple API Economy Vocabulary
Common language is a great invention. Should be Nobelized. When people get together from different domains to solve common problems, they form a community or even an ecosystem over time. Although the words we use would be the same, people don’t actually understand each others because the meaning behind the word might be really different. What are you going to do?
Previously we’ve discussed about openness, expertise and cross-domain communities. We discovered some pitfalls in the areas of openness, expertise and jargon talks as well as how to do work around such potential holes on the ground in order to magnetize the communities to work better together.
One simple way is the define the keywords. This blog defines a minimum viable vocabulary for cross-domain API Economy Communities.
The goal of this simple vocabulary is to support very basic populist talks about API Economy. Everyone must be able to participate in discussion about API Economy. Not just techi gurus. With populist talks the API Economy can be found in every pocket like a mobile phone. People should be delighted to find out how easy and wonderful way the technology and economy can actually be connected together.
To avoid “too long, didn’t read” impact, this vocabulary is kept very simple to cover the essential terms for API Economy talks. Cross-domain collaboration and community work becomes easy.
NOTE! There is no Open API in business driven API Economy.
Word of caution to Software domain experts. The simplification made here might feel a little violate act. We intentionally cut to corners, to help everyone to discuss about API Economy.
Basic keywords
API Software
API software is a piece of software program designed to serve other software programs. The concept makes programming for software developers a lot easier.
API software is a smallest independent value adding entity. It is a building block of software systems and applications. API software is often compared to those little plastic bricks kids are using to build their houses, cars and space ships.
API User
API User is another software. For example a mobile phone application uses several API Software and many times. API User rely on the value proposition API Software promises to deliver to its users.
Software developer designs her software to become an API User. This helps her task a lot to complete a program.
API User is made to fit together with API Software.
API Service
API Software can provide more than one services. For example a Door API Software. API User may want open, closed or locked a door. API User can delegate API Software to perform these tasks without skills and know how how it is done. Doors might be different, but the same API Software can promise to serve the users for every type of doors. Very handy.
API
API Economy is about to make business with API over the internet 24/7. API Software needs to be productized for this purpose.
Even the API services would be provided free of charge the API must be technically robust to put it in the Internet. Productization also makes it possible to change the mind over night to start actually collecting money with the API. If not from all, but from a specific API Users with slightly specialized and better services.
API Owner
API Owner is the business person of the API product.
API Customer
API Customer is a business person who wants to use the API and is ready to pay for the use of API. Good to notice the different levels of software and people. API User is a software while API Customer is a human being.
API Economy
The payments API Customers provide generates revenue to API Owner to cover the costs associated to maintaining and running the API. The money flow creates economy around the API.
Advanced keywords
API Access types
API business planning involves market segmentation of API Customers. To serve this purpose, API Access types are defined.
- Private API — provided for internal use only for organization in question
- Partner API — provided for selected partner organization
- Public API — publicly available for anybody
NOTE! There is no Open API in pure API Economy. This is an essential differentiation to “open data” movement, which holds the principle of freely available for everyone. The whole API Economy must be business driven, because without business there is no economy. Keep it simple. Say it clearly.
API Pricing model
There are variety of possibilities to build pricing models. API Pricing model can follow the pricing models of regular SaaS pricing models with categories from left to right, named e.g. according to precious metals, with increasing richer set of services what money can buy.
The leftmost category s important to be freemium, because the developers love to experiement with cool new APIs before commitment to make their applications to become a heavy user of your API.
Payment is made on timely basis, e.g. monthly. There are plenty of choices available in API Management systems you might be using.
API Management platform
API Management platform is a double-edge market place for APIs provided with the services for both API Owners and API Customers. API Management platform may be specialized to serve an ecosystem with a specific requirement required by the ecosystem.
API Customer tools
API Customer tools include all necessary tools to find, understand and take API into use as quickly as possible. The attention is paid on smooth and quick process to take API into use. API Owner is responsible to provide the content and API Management system responsible to provide means to deliver the content between the associated roles.
API Business tools
API Business tools offer all needed capabilities to manage API business by the API Owner.
API Ecosystem
API Ecosystem forms around common API Management platform. API Community transforms an Ecosystem when the parties become dependent from each others. The Community phase in development is more loosely coupled. Participants come and go more frequently.
Conclusion
Hopefully we find more and more people talking about API Economy. That is a cool small talk item. Domain specific experts help us to implement he dirty details just according to your dream of making additional business with API Economy.
Welcome to the API Economy!
