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Back in 2008, the first generation of mobile apps were static and ran in isolation on devices. While many applications were useful and interesting, they had limited interaction with live Internet data. Likewise, early social sites were self-contained and acted as single destination sites on the Web to which users had to navigate directly.

Adding backend interactions, however, changed both mobile and social experiences radically – both in the richness of the user experience and their reach.

Today, almost all mobile applications call out to backend systems of some kind in order to push/pull data, offload computation or access third-party services. Applications ranging from Mobile Games to Productivity Apps continuously synchronize and pull data from the network in real time.

Likewise, APIs have enabled social websites to rapidly expand reach – first by making it possible to embed social experiences into other sites, second by enabling large ecosystems of applications to enrich user experiences, and third by enabling new types of services which aggregate social data, analyze it and serve it back for reuse. Facebook’s like button and the Facebook Connect service extend Facebook’s reach widely across the Web. Likewise, Twitter’s application ecosystem is one of the major drivers of its success. In the third category, services such as Klout, PeekYou, PeopleBrowsr and others both depend on APIs provided by Facebook, Twitter and others as well as provide data services that can be reintegrated.

These shifts are turning APIs into the foundation of the fastest-moving parts of the Web. However, while these APIs are the most visible to date, the phenomenon is not isolated to the top social and mobile sites or applications. APIs are beginning to emerge across many sectors and arguably becoming critical to a wide range of Web applications.

Creating and managing APIs has become significantly easier with infrastructure players such as 3scale, Apigee and Mashery in the market, mobile backend services such as Stackmob, Appcelerator via Cocoafish, Parse, Cloudmine and others providing specialist mobile APIs, as well as open source code frameworks making it increasingly easy to develop and open APIs.

Part of the visible “iceberg” is ProgrammableWeb’s directory of APIs which recently reached 6,000 listed APIs, adding over 1,000 APIs in just the last three months. In addition, it is generally thought that there are likely four-to-five times as many APIs available on the Web, with many companies operating private/semiprivate customer or partner ecosystems.

At first blush it also appears that Web technology startups are the driving force behind API adoption, but adoption turns out to be far broader than this:

  • In a recent analysis of the latest 1,000 APIs added to the ProgrammableWeb Directory, less than 17% of the companies launching APIs were Web technology startups (defined as less than four years old with a primarily digital service).
  • Of the nonstartup APIs, small- and mid-sized companies still dominated, and the biggest areas were data services (21%), infrastructure (23%) and a wide range of SAAS apps respectively (24%) – the remainder of the APIs were split evenly between media, e-commerce, scientific and government APIs.

In terms of mobile APIs, only 11% were designed to enable mobile experiences exclusively, but over 60% aim for both mobile and nonmobile applicability. This suggests that much more general types of data services will begin to flow both around the Web and into mobile experiences.

In terms of social APIs, only around 40 of the APIs in the sample of 1,000 were tagged as having social features as their primary purpose. Here also, however, numerous other APIs in areas such as recommendation, travel and video had social themes as secondary or additional themes.

Business models around APIs are also maturing, with a wide variety being applied to different sectors, as John Musser’s presentation at Gluecon recently illustrates: Diversity in business models is increasing and there is clear business value in many of the APIs being launched.

The business models adopted by the 1,000 APIs in the study also applied increasingly well-defined business models: 26% providing API access as a clearly valuable extension to an existing Web-based product, 24% directly charging for API access, and 20% adding APIs as reseller and partner channels (the remaining APIs were evenly split between government, scientific and nonprofit APIs). This is a significant shift from just two years ago when the majority of APIs were still primarily free loss leaders or unsupported test services.

Given these trends, it seems likely that we will continue to see the emergence of more APIs in diverse sectors and also a healthy feedback loop of new experiences and features into social mobile applications – as well as to other parts of the Web economy.

Whether ProgrammableWeb’s prediction of one API per company will come true and how quickly remains to be seen, but APIs should likely be near the top of people’s technical strategy lists in the next two-to-three years.

Author: Steven Willmott, CEO, 3scale

3scale (Twitter: @3scale) is an API infrastructure provider that powers over 100 APIs – supporting APIs with out-of-the-box access control, rate limiting, analytics, developer community and monetization services.