Why APIs are the bedrock of our new digital economy - Image by Gerd Altmann from Pixabay We know APIs matter. But why do they matter, really?

There are certainly a lot of APIs out there now. A large enterprise has as many as 26,000 in use. According to a report from 451 Research, the industry average is more than 15,000. A 2020 poll of developers found that 90% of developers now use APIs in some capacity. 20% make a living selling the ones they develop—which is probably why 69% of those contacted say they use ones they haven’t written themselves.

At Rapid, we think about three ways people discover and use APIs.

  1. Public APIs are generally open for any developer to pay to use and focus on making it easy to find value quickly.
  2. Partner APIs share a subset of your data with another company, often requiring a relationship with the provider for approval.
  3. Internal APIs also often require approval for use and come with various security and authentication requirements.

Despite these differences, some common themes emerge across these use cases: the need to find APIs; the need to confirm that APIs provide the requisite capabilities; and then the need to be able to subscribe and access APIs.

Why are APIs so popular now?

Even though APIs are seeing a Cambrian explosion of protocols and architectures–such as REST, GraphQL, even gRPC–the earliest ‘application programming interface’ can be traced back decades. In 1968, Douglas McIlroy, a researcher at Bell Labs, introduced the concept of software components or “pipes” as part of the Unix operating system.

The idea was that these pipes could be used to pass data and information between different programs, allowing them to work together more effectively. However, APIs only really took off on the Web in the early 2000s when we wanted to start connecting services to websites. So why are they skyrocketing now?

It’s partly about convenience and also the current labour shortage. Developers look to avoid reinventing the wheel, which is why code libraries and things like Open Source and GitHub are so popular. If someone else has built something useful, trusted, and secure that helps do a routine job, it helps a developer get an app over the finish line much faster.

Developers are getting swamped by APIs

Convenience that leads to productivity is certainly very compelling. However, left unchecked, APIs can multiply and leave developers feeling overwhelmed. How does one choose from the many APIs that crop up daily in public and internally? There’s also the issue of managing these APIs once they’re in use. Not only does API versioning bring complexity, but too often, there’s no way to determine if the API you want to use is something you can rely upon. A lack of analytics often can lead to a lack of confidence.

This is where an API hub comes into play. They are a central resource where developers can discover the APIs they need and get the information and insights they require to trust them. When properly set up and run, an API Hub can considerably cut the time needed to select the external services you want and start using them. Just plug them into your app, and plough ahead with your project.

It’s no surprise that I believe in the API Hub approach. I work for a company that has built the largest API Hub. It serves more than four million developers who use it to find, test, and connect to tens of thousands of APIs. It also makes it easy for developers to get started fast by generating the code to consume these APIs by using one of 15+ programming languages.

But the benefits individuals and developer teams find useful about third-party APIs are only part of the story. As we know, APIs underpin today’s Web and, therefore, our whole modern digital economy.

A new engine for business

Whatever you think is the most important technical advancement driving the next wave of commercial innovation in IT—AI, blockchain, the metaverse, machine learning, containers or microservices—unless you recognise that APIs are the glue that make all of it hang together, you’re missing the bigger picture. Just look at the rise of ChatGPT. How is OpenAI enabling developers to embed ChatGPT in all their applications? You guessed it, APIs.

This is why it’s important we not only see APIs as plumbing, but as the foundation of a new economy. The fast development time and increased security you get from using APIs in a new system is one thing, but creating new revenue opportunities is becoming just as important.

In the age of digitalisation, businesses are quickly growing. They want to scale quickly, and they can only do so by relying more and more on the value delivered by API Hubs. Using APIs is not just a way of adding a great geolocation service; it’s also a way of standardising how you build, manage, and bring those apps to market.

Many of the smart minds who used to work on closed, proprietary apps – for example, at enterprises like MasterCard and eBay – are now building APIs that a wider developer community can access. IT leaders can now support their business partners more effectively by having their teams assemble and refine new apps using proven services whose code is tested, governed, and secure.

Become a disruptor business with an API Hub

Beyond the enterprise, the API economy also drives new business growth. Say you want to launch a new challenger bank like Monzo or Starling. For these, user experience and innovative services translate into loyalty and market share gains. Once, you’d have to build all that functionality – from verifying customer identities to the ability to search for transactions – yourself.

So much engineering effort that once had to go into building fundamentals like that for your new service. Now, that time could be crunched down to almost zero with APIs.

Just think what that speed of development could mean to the next Just Eat, ASOS or TransferWise – or whatever ground-breaking business you’re involved with.

And that’s why APIs – and API hubs – matter.

rapidRapid is the leading API Hub provider. It’s the first API Hub built for the cloud and has the largest developer community of more than 4 million active developers. Only with the Rapid API Hub can individual developers and businesses of all sizes build, consume, and manage their APIs, rapidly building what’s next. Fortune 500 companies trust the Rapid API Hub. Learn more here.


Please enter your comment!
Please enter your name here