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APIs for biz dev 2.0 - Which business model to win in the API Economy?
1. APIs for Biz Dev 2.0
Which Business Model to Win in
the API Economy?
Guillaume Balas
http://www.3scalet.net - @3scale
guillaume@3scale.net - @guillaumebalas
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2. The Plug & Play Cloud API Management
Platform & Infrastructure
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3. The Plug & Play Cloud API Management
Platform & Infrastructure
THE API ECONOMY
Welcome to
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4. The Plug & Play Cloud API Management
Platform & Infrastructure
APIs are everywhere, reshaping the web
IoT: 8.7 Billion devices
(Rob Soderbery, Cisco Executive, Forbes July 2013)
Internet: 633 Million websites
(Netcraft, December 2012 survey)
Mobile: 1.3 Trillion in-app events
(Prashant Fuloria, Chief Product Officer for Flurry, MobileBeat 2013)
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… and reshaping all Businesses
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Platform & Infrastructure
10,000 APIs: just the
tip of the Iceberg
At 3scale we actually believes that
there is 5x to 10x this number out
there.
With an approximated 100%
annual growth, that would mean
around
1 Million APIs by 2017
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Platform & Infrastructure
HOW DID WE GET THERE?
But…
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Platform & Infrastructure
“Software is
eating the World”
Marc Andreessen, WSJ, 2011
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Platform & Infrastructure
“APIs are the
building
blocks of the
Digital
economy”
Laura Merling, VP Ecosystems and Solutions at AT&T, PWC 2011
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Platform & Infrastructure
“APIs are
eating
Software”Steven Willmott, CEO at 3scale, June 2013
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Platform & Infrastructure
CONTROL AND UNIFY THE CORE
INTERFACES TO YOUR BUSINESS
The need to
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Platform & Infrastructure
“[APIs] will be
essential for
competitive
survival”
Dion Hinchcliffe, Zdnet, November 2008
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Platform & Infrastructure
AN API DRIVEN BUSINESS
Towards
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Platform & Infrastructure
Your organization’s core asset
is what is valuable.
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The API is “just” the channel into this.
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Platform & Infrastructure
“What API for my
business model?”
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APIs can drive success in 5 different ways:
Mobile
Enablement
Customer & Partner
ecosystem growth
Digital distribution
channels
Powering new
business models
Internal efficiency
& innovation
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Platform & Infrastructure
KEY CONSIDERATIONS
API Business 101
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APIs enable cloud scale MVC,
① Identify core asset
② Choose complementary asset which will
deliver most value
③ Define strategy to capture the value most
effectively
allowing you to focus on your core asset.
Examples of Business Strategy
Presentation Logic DataMission
✓
Simplify the world of
telecom by providing
simple, powerful, pay-
as-you-go IaaS
✓
Increase the world's
access to data,
especially free and
open data
✓
Revolutionize the way
people watch movies
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Organization’s core asset
MVC analysis framework
Model
Controller
View
= Data/Content
Presentation =
= Logic
View
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Platform & Infrastructure
CORE
ASSETS
Raw Service
Mesure, Collect, Analyze
Internal Re-Use
Inter Depts, Dashboards, Processes
Customer
Re-Use
Apps, Integration
Partners & Distribution
New Revenue, New Reach, Ecosystem
Open to Anybody
1000 Flowers, Market Extension
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Degree of openness
The openness cycle
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Platform & Infrastructure
Source: John Musser, ProgrammableWeb.com
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Revenue model
Your imagination is your limit
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Partners
Affiliates
Mobile Users
Internal Projects
Developers
Customers
Your content &
services
Your API
Security?
Monitoring?
Access Control?
UX/UI?
Documentation ?
Scalability?
Flexibility?
Reach?
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Delivery
A Dev Ops & Business decision
Support?
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Platform & Infrastructure
Partners
Affiliates
Mobile Users
Internal Projects
Developers
Customers
Your content &
services
Your
API
APIBusinessEngine
Access Control &
Security
Analytics &
Reporting
Developer &
Partner Portal
Billing &
Payments
API Management Solution
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Delivery
A Dev Ops & Business decision
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Platform & Infrastructure
API TYPOLOGY
Business Opportunities
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e.g
The API is the product1
The API projects the product2
The API powers and feeds the product4
The API promotes the product3
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Functional roles
4 Types of APIs
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Others
Brings easy access
to complex Telecom
technologies
e.g
Ecosystem
Strategy
Direct customer usage
Encourage resellers
Build tech knowledge
Encourage 3rd party tools
Enable new services
$ If Core service sees usage growth.
API
API is Core Value
The API is the product
Core value is tied up in the API
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1,700+ Apps on
Force.com
50k+ Developers
e.g
Ecosystem
Strategy
Cultivate partner ecosystem
Innovation opportunities
Build switching costs
Enables new services
Encourage 3rd party tools
$ If
Increasing customer spend (primary) and
number of customers (secondary) for core
product
The API Projects the product
Extends availability of functionalities to new places
Others
Mobile apps
3rd Parties integration
Added utility
Added to a product
API
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Platform & Infrastructure
Ecosystem
Strategy
Distribute “Teaser” information
Brand Diffusion
Promote to niches
Improve partners Impact
Cultivate partners
10’s 1000’s of affiliates
Widgets to
Whole sites powered
e.g
Others
$ If Increasing customer number (primary) and
spend (secondary) on core product
API
Secondary (non core) service
Designed to drive leads/
trafficWidget
The API Promotes the product
Secondary function and indirect revenue impact
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Platform & Infrastructure
13 Billion calls/day on API
>75% of traffic by API
250,000 Apps (probably less
now…)
e.g
Others
Ecosystem
Strategy
Leverage social networks
Brand Diffusion
Facilitate Access
Improve partners & businesses
Impact
Virtuous circle data in/out
$ If when UGC (user generated content) brings
appreciable value to the central product
API
Content, User
information,
Ratings, comments
Etc. into the service
The API Powers & Feeds the product
Content acquisition via the API
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Platform & Infrastructure
Is the product
• Direct revenue
• Utility / Pay per
transaction
• Tiered pricing
bands
Projects the
product
• Reach more
places
• Provides more
utility
• Enable mobile
• Allow deeper
integration
Promotes the
product
• Biz Dev / Lead
Gen
• User acquisition
• Advertising
• Brand promotion
• Affiliate
programs
Powers and feeds
the product
• Content
acquisition
• Partner tie-in
• Internal
innovation
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Summarizing
Each type of API has different potential business value associated with it
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23.60%
26.30%
20.10%
7.20%
12.50%
10.40%
Business Models Diversity
API
is
the
Product
Product
Addi?on
Product
Projec?on
Government
Scien?fic
Non-‐Profit
1. It is the your organization’s core asset
which is valuable
2. The API is the channel into it
3. What API(s) for your Business Model?
4. DevOps & Business considerations
5. Management buy-in and commitment
needed
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Conclusion
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Platform & Infrastructure
3scale SPAIN
Calle Napols 187, 8
08013 Barcelona
Spain
+34 933 092 786
3scale USA.
450 Townsend Street,
San Francisco, CA 94107
USA
+1 (408) 524 1503
THANK YOU !guillaume@3scale.net
@guillaumebalas, @3scale
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Out-of-the-Box API Management solution
http://www.3scale.net