the api economy (with speaker notes)
TRANSCRIPT
THE API ECONOMY Exploring the reinvention of business by
API’s and software developers
James Parton Ignite Keynote, 15th March 2016
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A LITTLE ABOUT ME
2
20 years at the intersectionof telecoms & the web
6 years actively supportingthe community
@jamesparton | [email protected]
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In computer programming, an application programming interface (API) is a set of routines, protocols, and tools for building
software and applications.
DEFINITIONS - AN API
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THINK BUILDING BLOCKS
APIs are the building blocks that are the raw ingredients of innovation because they enable developers and organizations of any size to rapidly build new ideas.
The sum is greater than the individual parts - think lego - modular, flexible. You can build thousands of unique things with the same basic blocks.
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A process or system by which goods and services are produced, sold and bought in a
country or region
DEFINITIONS - AN ECONOMY
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A set of business models and channels based on secureaccess of functionality and exchange of data to an ecosystem
of developers and the users of the app constructs they build —through an API, either within a company or on the Internet with
business partners and customers
DEFINITIONS - API ECONOMY
There are no geo or political boundariesThe ‘Goods’ are API calls, software to software, with no human interactionThe enablement of other goods / services is the end game
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An invisible revolution
THE API ECONOMY
As i mentioned in the definitions, much of the API economy happens ‘under the hood’, software to software, with end user being unaware of how, they just experience the benefits
Consequently many of the API power houses are not house hold names
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AND ITS A WILDFIRE
$680m raised
Source: businessinsider.com, 18/12/15
Interesting Business Insider article in December which picked up on this - the 9 startups that secretly run the internet.
They are all developer focused, with an API at the heart of their product delivery.
Just this half dozen have raised over $600m - US VC’s in particular are switched onto platforms & ecosystems powered by APIs
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THE NEW VALUE CHAIN
API API
Source: Sam Ramji ‘Darwins Finches, 20th Century Business. and APIs’
You have to ensure you remain in the modern value chain
The primary interface between the provider and the developer, and the brand and the consumer is the API
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CONNECTED APPS AT THE HEART OF MODERN BUSINESS
“We are moving into an age of extensible apps and Slack is likely the new norm for software businesses.
In the earlier days of the Internet, applications could stand alone, but now they are expected to not only connect and share information, but extend their functionality by connecting with other apps.”
- Jack Berlin, CEO of Accusoft.
Source: forbes.com, 30/11/15
Another interesting article, worth reading is from Forbes…
I love this quote from Jack Berlin.
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BUSINESS IMPERATIVE
“Today, a firm without application program interfaces (APIs) that allow software programs to interact with each other is like the internet
without the World Wide Web. “
14,700 APIs listed
REVENUE GENERATED via APIs
50% 90% 60%Source: hbr.org, 07/01/15
Harvard Business Review is also writing about the API Economy.
They say….quote
To give you an idea of the scale of change…programmable web
And this is driving the bottom line - % of revenues.
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AN ABRIDGED HISTORY
SalesForce7th Feb 2000
eBay Developer20th Nov 2000
amazon.com Web Services16th July 2002
Source: apievangelist.com
Well actually APIs are long established in the IT world.
Things got interesting, and the API economy started, when the shift to modern web APIs, exposed externally from the organisation started.
Visit apievangelist.com for more
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What were the triggers?
THE RISE OF THE API
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The maturation of the web and cloud stack
Rabid demand from Tech Start Ups
Enterprise reinvention
THE RISE OF THE API
The modern tech stack - RESTful API design, Programming languages, Cloud
The rapid rise of API powered startups - flexibility to build businesses on API platforms - they can focus on the problem they are trying to solve. Mention Go Cardless.
And enterprise needing to reinvent how they do business and add speed
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THE NEED FOR SPEED
Source: CEO Keynote I Love APIs 2015: Chet Kapoor Apigee
The rules have fundamentally changed.
Startups need to build and grow fast for hyper growth
Enterprises want the agility of start ups
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26 million developers by 2019
THE RISE OF THE DEVELOPER
Start Ups Enterprise
Technical co-founders Bring your own device Bring your own service
Build vs. Buy is natural - differentiation is key
The speed of change has far out paced procurement
Focus on the problem they are trying to solve Transformation of Digital Agencies
Speed of change has far outpaced procurement, even the IT department?
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CASE STUDY #1
• Needed a solution for beat police to communicate with Neighbourhood and Farm Watch groups
• Support channels the public wanted to use. Special consideration for rural areas with limited mobile internet
• Single platform covering all communication forms for a better customer and user experience
• Built by a team of in-house developers - vendor solutions too bloated and expensive
• 28,000 people have used the service generating 260,000 SMS & 20,000 call minutes.
• Cost per digital interaction of 30p vs £5 for traditional call centre
Launched June ‘15
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CASE STUDY #2
www.parkinsonsvoice.org
www.ted.com/talks/max_little_a_test_for_parkinson_s_with_a_phone_call
Over 6 million people are currently diagnosed with Parkinson’s diseaseThe vocal fold displays tell tale tremorsDeveloped algorithms that can analyse fluctuations, tremors and other symptoms in recordings of the human voiceMass data collection project to collect 10,000 voice recordingsRemote, non intrusive identification of the disease and severity - 30 second phone call replaces a $300 clinical test
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Some food for thought
THE HOME STRAIGHT
Thought I would wrap up by putting together some statements to provoke some thoughts.
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Who could have predicted the worlds largest book seller would be hosting a ⅓ of all internet traffic,
earning them $6Bn a year,And all in the space of just 9 years?
FOOD FOR THOUGHT
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The time between identifying a business need and delivering the IT solution to address it will become
hours and days rather than months and years.
No matter what the area, those who look to software solutions will outmanoeuvre those who look to
monolithic platforms.
FOOD FOR THOUGHT
Cloud will win - rapid procurement, scalability, adaptability, cost savings.
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Complacency has never been so dangerous
Think at scale
Differentiation is built:75% of all app purchases will be build by 2020
FOOD FOR THOUGHT
Source: Gartner, Enterprise Application Software, Worldwide, 2Q15 Update
Competitive plays can now launch in months
You have to build for differentiation. How can you stand out if you are buying the same solutions from the same vendors as your competition?
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2000: Rent by the year2003: Rent by the month2008: Rent by the hour
FOOD FOR THOUGHT
Lets look at AWS again.
If you don’t believe me when I say complacency has never been so dangerous,
You think for one minute they have sat back and patted themselves on the back for the great job they have done?
They continue to disrupt themselves
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What is your developer strategy?
How are you attracting developers to your brand?
Is your motivation genuine?
Traditional sales & marketing approaches are not appropriate
Is your success truly linked to the success of the developer?
FOOD FOR THOUGHT
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FOOD FOR THOUGHT
Don’t buy into the clichés that your success with developers is linked to the volume of pizza you buy.
You have one shot to get it right
I’ve seen large companies thinking they need a hackathon, not being clear on why, and then asking their marketing agency to lead it. Recipe for failure.
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FOOD FOR THOUGHT
hackdaymanifesto.com
Learn from the experts, and get them involved before you reveal anything publicly
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The right business model is also the right motivational tool…
Twilio +69 NPS vs. +29 s/w industry average
FOOD FOR THOUGHT
TraditionalHardware
TraditionalSoftware Twilio
Multi-year Capex Maintenance Contracts Per seat licenses Pay as you go
Breeds complacency Customer Focused
You want your people coming to work everyday thinking about how they keep your customers happy
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AND FINALLY - API’S READY FOR THE MAINSTREAM?
If This Then ThatA B2C API service - 293 APIs already integrated
Big focus on IoT and the smart home
And finally…
Smart home - Philips Hue, Nest, Hive - very hot right now (see what I did there) - and I believe a number of these companies are at the event.