Facebook And The Sudden Wake Up About The API Economy

What a two weeks it’s been. Something happened that has been simmering for a while. The API market exploded. Intel bought Mashery for more than $180 million and CA acquired Layer 7. 3Scale received a new $4.5 million round of funding from Javelin Ventures. Programmable Web acquired Mulesoft. And then Facebook jumped in and bought Parse. The acquisitions and funding point to a maturing market that is reflected in the ubiquity of APIs across the application landscape. It’s not a new market by any means. The space is filled with companies that have leveraged the API build out that has happened over the past several years. Instead this is an inflection point. There are more than 30,000 APIs, according to Programmable Web, the leading API directory and blog. Javelin Ventures Managing Director Noah Doyle said to me in an interview that analysts see the API market growing five to ten times over the next five years. With that scaling in number of APIs comes a virtuous circle for the developers that build compelling apps and APIs. The APIs extend the apps reach as they become part of distributed data network. As more people use the APIs so the app developer generates more data. As the data increases in scope, often the service will become an API. Facebook needs new streams of data to keep rolling out new digital products. Back end as a service providers like Parse provide SDKs and APIs that give developers access to infrastructure for storing basic data types, locations and photos. How Facebook uses this data is a question mark. But regardless, Pare serves as a constant replenishing source, nourished by the apps on the Parse platform that use APIs. Facebook now will decide how to package and segment that data to push more relevant advertising to its 1 billion users. APIs Are Like Glue APIs will be the glue to the Internet, said Programmable Web Founder John Musser. Musser, like Doyle, sees a new generation of APIs emerging that are fueled by demand, triggered by mobile devices, which serve in many respects as the new client/servers. Apps are hosted on cloud services and distributed across mobile devices that read and write data, sending and receiving information, connecting via APIs. In the first generation, Mashery and companies like Apigee pioneered the API management space. Twitter and other web companies emerged in the second generation. In the

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