Why open APIs are more successful than closed-loop systems?
We are living in the era of open APIs. Organizations are increasingly realizing that open APIs offer many benefits as compared to closed-loop systems. Here’s why.
The Open API Advantage
The fundamental advantage of open APIs is flexibility. With an open API, developers can come in and exercise their own creativity and ingenuity when developing an application. They aren’t locked into any particular system, as is the case for closed-loop, custom-built systems.
Open APIs are more easily scalable and cheaper to maintain. Essentially, they are platforms that can be used widely. Closed systems are more customized, but they are essentially boutique services.
Although there is a certain appeal to a highly customized application, organizations that use closed-loop systems often find that customization consumes significant resources. Moreover, it can be difficult to integrate closed-loop systems into other systems. This results in organizational silos that hinder growth.
Perhaps the biggest limitation of closed-loop systems is that they create dependency on particular platform — which drives up cost and necessarily imposes limitations on developers.
Open API Successes
Thanks to the open API advantage, we’re seeing more and more success stories in this space. Even companies like Apple that have traditionally been very secretive now integrate open APIs into their offerings. Take the App Store. The tens of thousands of apps available were developed by third parties. This offers users a far superior experience. We’ve seen similar developments with other tech giants such as Google. Just think about how many applications make use of Google Maps — and how few of them are from Google itself.
In recent years, it’s become quite apparent that open APIs are a good business model. Twilio, for example, is a cloud communications platform that has thrived thanks to open APIs. Organizations can easily customize Twilio to their needs so that they can send and receive text messages and phone calls.
Salesforce too has benefited from its open API offerings. One way that Salesforce is able to differentiate itself from competitors is through the massive marketplace of third-party applications, available through Salesforce itself. Salesforce has supported third-party development because it understands that this drives revenue. A few years ago, Salesforce acquired the API management company MuleSoft for $6 billion.
These developments mark a sea change. Once, conventional wisdom held that organizations should hold their data close. Now, we understand that it’s better to offer open data and tools. This enables organizations to plug and play.
Sheeva.AI & the Open API Model
We see Sheeva.AI as a platform that can be widely used. We envision a future in which cities and service providers all over the world use Sheeva.AI to enable a smart mobility experience for residents and visitors.
This necessarily requires an open API. Customizing a solution is costly. But if virtually any enterprise and city, big or small, is able to use our platform to develop solutions appropriate to local conditions, everyone benefits. We do not want to lock up our data. The more people who contribute to our platform, the better it will be.
