Here’s an example of how a business partnership might come about these days. Interaction with an online API partner portal will act as the initial “conversation” that leads to the partnership. If you want to integrate with Salesforce.com, you go to the Salesforce partner portal, figure out the relevant SDK/API, build an app and then submit it to the Salesforce AppExchange.  You don't ever need to actually talk with anyone at Salesforce to become a business partner with the company.

Another example is the way many companies now enable access to their Web sites via Facebook Connect, Google+ Login or Twitter Login. This represents the first step towards establishing a business partnership with Facebook, Google or Twitter. It’s not new in the Web world and has been discussed for years. What makes it relevant to this discussion is the way it’s being applied to out-dated business processes and practices.

Great platform companies have realized this, “robotized” their business development processes and rationalized their business development teams. As robots are to manufacturing, APIs are to business development. Better technology means that we can focus our human resources on more valuable activities, since handshakes are now being made over OAuth instead of costly dinners and drinks.

“Government information shall be managed as an asset throughout its life cycle to promote interoperability and openness, and, wherever possible and legally permissible, to ensure that data are released to the public in ways that make the data easy to find, accessible, and usable” (emphasis mine).

No Dumping
The usual approach to this type of work is to simply publish raw data in a directory or repository and then create some fencing around the data that helps track usage and distribution. Essentially, making government data “open” becomes a data dumping operation. This practice fails on all of President Obama’s three key points. First, data dumps make finding valuable information not at all easy. Second, even though the content might appear in a standard format like XML, CSV or JSON, it is hardly accessible (except for to geeks, who love this kind of stuff). And finally, raw data is hardly ever usable. Instead, it’s a mind-numbing pile of characters and quote marks that must be massaged and re-interpreted before it comes close to usability.

So, while this new directive offers an opportunity to make available a vast amount of the data the government collects on our behalf, the devil is in the details. And the details are in the interface – the API. As with poorly-designed kitchen appliances and cryptic entertainment center remote controls, when it takes extensive documentation to explain how to use something, the design has failed. There's a simple principle here. Poor API design results in unusable data.

Affordable Data
It doesn't have to be this way, of course. Government departments have the opportunity to implement designs that meet the goals set forth in the executive order. They can make it easy for people to find, access and use the data. They can publish not just data but APIs that afford searching, filtering and exploring the data in a meaningful and helpful manner; APIs that empower both users and developers to successfully interact with the data, without resorting to a dashboard featuring dozens of options or mind-numbing explanations.

In the (likely) event that the initial open data release consists of mere data, companies and individuals would be well advised to resist the temptation to build a multitude of “one-off” applications, each of which solves a single problem or answers a narrow set of questions for some subset of the data. Instead, work should be put into converting the raw data into usable API formats such as Atom, OData, HAL, Collection+JSON and HTML (to name just a few). APIs should be designed with the same care that would be given to any interactive experience.  Investment in tools and technologies that can properly represent the data in multiple formats while supporting various use cases and access requirements will yield great results.

Open Data APIs
In the end, organizations that know the importance of a good interface, the power of choice and the freedom of flexible representations will be able to convert raw data into valuable information, which can be consumed by a wide range of users, platforms and devices. These considerations are essential to building and supporting open data APIs.

Because – ultimately – data isn’t open, unless it’s “easy to find, accessible, and usable”.

While several start-ups have demonstrated the potential of tapping the long-tail developer community (look at examples like Twillio, Tapjoy, Stripe and Braintree) the number of enterprises that have seen similar success is less clear (Amazon Web Services is an obvious counterpoint).

One reason for this is simple – enterprises have conflicting interests and are almost never set up to successfully service these communities at all costs. This doesn't negate the value of fostering relations with the long tail. External developer programs make sense for enterprises and should be viewed as strategic, even if the immediate payback is not obvious. With the advent of the app economy, developers represent as important a channel to market as traditional distributors.

However, often overlooked in the race to launch an external API developer program is the potential benefit of an internal API developer program. Enterprises have, in many cases, thousands if not tens of thousands of developers internally. Often, internal developers are supplemented by contractors. Enabling all these developers to become mobile innovators through APIs holds out the promise of delivering the kinds of leaps in productivity, agility and experimentation that will benefit any enterprise.

To make internal developers innovation leaders, it is essential to provide a canonical way for these developers to access all corporate application and data resources. An API abstraction layer delivered through an ESB or API Gateway simplifies the process of API-ifying information resources and consuming APIs.

But that’s not enough because developers will still need a central directory or registry of APIs to discover which APIs are available and what these APIs do. In the WS*-centered Web services world of SOAP-oriented APIs, which most enterprises still inhabit, this function would be handled by a UDDI directory and some accompanying “repository” software. But in the API world, no exact analog has existed – in part because every API Management vendor has insisted on provisioning its API portal in the public cloud only, a place most enterprises are reluctant to post APIs aimed at internal developers. Layer 7 aims to bridge the gap.

The Layer7 API Portal is the first turnkey API developer portal that can be deployed 100% inside a customer's private cloud, datacenter or IT facility. Moreover, it is the first developer portal to offer simultaneous support for both RESTful APIs and SOAPy APIs, meaning it can act as a substitute for existing UDDI-style services while providing a pathway to newer RESTful services. Best of all, it can be implemented with different grades of privacy so that the same API Portal can support internal, contract and external developers at the same time – with each group seeing only what the enterprise chooses.

By centralizing where APIs are presented for discovery and consumption by developers, enterprises can make it easier for their service innovators to build new capabilities and mash multiple existing services into newer composite business functions. They can introduce new apps and applications faster. They can respond to change faster. They can build and iterate on new mobile apps in less time, with less error. It all comes down to the API presentation layer.

With the steady decline of the PC business, Intel clearly has to look elsewhere for its future growth. The cloud datacenter is not a bad place to start. Cloud server farms clearly consume lots of processors. Still, servers powering Web sites can operate fine without APIs, thank-you. But servers powering mobile is a different story. Mobile apps (whether HTML5, hybrid or native) get the data that makes them valuable from applications that reside in datacenters. And APIs are the key to letting cloud data be sharable with mobile apps.

Clearly, app-centric “smart” phones and tablets and TVs and cars and watches and glasses are changing the way we go about our daily business. And APIs will power these smart devices by giving enterprise and Internet companies a way to push their data to apps. That hope of bridging the cloud with mobile is probably why Intel has kept its current API product intact. Mashery broadens Intel’s API scope by providing a way to not only share data with mobile apps but now also the developers that build these apps. But will this plan succeed?

If it does, it will take quite a bit of time. The reality today remains that Intel – even despite the semi-recent McAfee acquisition – is not oriented to selling software or even cloud services into the enterprise. It's missing the sales force. It's missing the history. And in many ways, it's missing the rest of the software stack it needs to power the networking, infrastructure and application parts that underpin data in the cloud. That will make selling an API platform comprising a legacy API Gateway and newfound API developer platform a harder proposition. It's kind of out there alone.

Another obvious roadblock to making the Mashery acquisition successful is that Intel’s existing API Gateway and the Mashery API service are designed for two very different audiences inside the enterprise, with un-reconcilable needs. The API Gateway is designed for an IT department that wants to run its API Management layer in its own datacenter. The Mashery offering is designed for a non-IT buyer (a mobile program manager, say) who wants to run everything in someone else's cloud.

One is technical, the other is not. One is on-premise, the other is SaaS. One sells traditional software licenses, the other pure subscription. The first aims to address internal and external API integration challenges. The latter is only really concerned with the challenge of acquiring external API developers (though Mashery would probably protest this point).

Will the two be a marriage made in heaven? Given that the Intel/Mashery partnership is already a year old and that Mashery was barely able to grow its revenues in that time, the likelihood seems remote. But who knows for sure? And anyway, Intel has probably not bought Mashery for its $12M in revenue but for its long-term potential as a pathway to mobile.

We’ll also talk about the “-ilities” of an API Management platform: scalability, manageability, extensibility etc. We will illustrate each of these with a real-world Layer 7 customer example. You’ll see why these and other non-functional requirements matter just as much as the solution’s technical capabilities.

So, please join me and Layer 7 Product Manager Dana Crane as we discuss these key API Management criteria tomorrow. There will be time for questions – both technical and conceptual – and all attendees will receive a free copy of the recently-published Forrester Wave for API Management Platforms. See you tomorrow!

Register now for How to Choose the Right API Management Solution >>

For instance, most organizations will derive far more immediate payback from an API initiative if it enables internal developers, enterprise mobility initiatives, tighter partner integrations or even IT rationalization through hybrid cloud. Each of these endeavours will pay dividends in terms of productivity, agility, distribution and lowered IT costs. Each deserves its own dedicated discussion. However, underpinning all of these API business drivers  – external developers included – there is one often-overlooked consideration for cost and return in any API program: how do you introduce and innovate new APIs cost effectively?

Obviously, there are many ways to stand up an API. Many packaged software applications have some kind of API already, even if some are XML- or SOAP- centric. But in many instances, nothing exists except the desire to expose a piece of functionality or quantity of data as an API. Programmers can obviously build “programmable  interfaces” onto almost anything. It just takes time and people. However, the results will be brittle and the journey expensive.

A faster, less costly and more flexible route is to use an adaptation layer that can talk to various application or data backends and dynamically render one or more as an API. Using a backend adaptation layer can, with the right product, also solve the related problem of iterating on an API, both in terms of versioning but also composition. Add to that the promise of facilitating new business functionality by orchestrating API interactions with external mobile, social and cloud services and you get a pretty compelling ROI story.

Not surprisingly, Layer 7 provides such an adaptation layer. Our API Gateways provide more than just security and management; they simplify backend connectivity, new API formation (i.e. composition) and novel orchestrations with all kinds of cloud, social and mobile services. Like many of our API compatriots, we provide tools that help enterprises build and foster developer ecosystems. But we also realized early on that much of the cost and potential of an API program will rest on how quickly and cost-effectively new services can be launched and evolved. Something worth considering the next time you evaluate the ROI of an API program.

Why did  the “disintermediated” direct-to-buyer model win? Simple: it was simplicity. The problem with multilateral exchanges is complexity. They require members to buy in completely and never hedge with alternative paths to consumers; they require the exchanges to always be subservient to the members; and they require 100% participation and 100% consensus. That's why they keep failing despite the best efforts of organizations like GSMA, the UN, OASIS and others. They require a rigid web of multilateral agreements, subjugation of individual corporate needs to ephemeral collective goals and universality. Just because the broker is a for-profit entity like Apigee doesn't change anything so long as success or failure depends on universal cooperation and comity. To repeat an oft-used metaphor: putting lipstick on failed efforts like WAC and OneAPI won't make them any more attractive. They will never have the agility and directness of an over-the-top direct-to-buyer/consumer/developer service. That's why giant operators keep getting beat by three-person Y Combinator start-ups.

Does this mean aggregation is dead? Of course not! Aggregation models can work but only if the “broker” has the independence and freedom to go off and negotiate unilateral agreements as needed. The aggregator must have the freedom to be run like a self-interested business where the wishes and hopes of the underlying providers don't factor in. As evidence look at the growing disparity between Netflix and Hulu. The latter emerged as a deliberately-crippled response to the growing power of Netflix. However, the need to accommodate multilateral interests has made it irrelevant. ISIS is fairing no better in the payments arena.

For operators, there is a similar lesson. Be the broker or sell to the broker. Each model has clear economics and places success or failure in the hands of the operator. If an operator wants to offer non-geo-specific services to buyers, it should partner with over-the-top providers or get the capacity from other operators one-to-one. If an operator would rather wholesale its services, be promiscuous and enable every broker/aggregator to consume its services, fine. Then let them be your buyers. The beauty of both models is that they are non-exclusive and don't require consensus, universality or other impracticalities.

I give Apigee credit, the API Exchange is an improvement over the failed WAC. However the problem was never just technology. Some business models just don't work in practice.

My rather unsurprising answer to both questions is: “No”. Clearly, some developers will be more valuable than others and borrowing will never be a substitute for ownership. Here's why:
•    The only developers that matter are those that are engaged and active

Registration numbers don't matter. “Key Wielding” this or that is marketing fluff. Looky-loo's don't build apps that drive revenue or reach. They may take your time, they may toy with your APIs but they won't deliver business value. And if they are borrowed, “drive-by” developers, guess what – they never will!

As a vendor that helps organizations publish APIs, my advice is to always own your developer. Don't get caught up in the promises of vendors lending access to hordes of faceless developers. The only developers that matter are the ones engaged directly with you because those are the ones that care about your API and those are the ones that you can develop and nurture.

This does not mean that making it easy for high-value developers to access your APIs should not be a goal. Giving engaged GitHub developers the ability to use their credentials to access your APIs is smart. There are millions of current, high-quality developers waiting for the right project.

So, pick a vendor like Layer 7 that enables onboarding and Single Sign-On from GitHub and other deep pools of active, engaged developers. And be careful not to get caught up in the developer equivalent of a feel-good payday loan. You will pay a high price in the long run.

If They Have to Ask…
Try this:

• Create a new Web API
• Get it up and running on some server or other
• Hand the single URL to a client dev and say: “There ya go!”

Is the API self-descriptive? Does it contain enough information in the responses to allow client devs to know what the API is for, what it is capable of and how they can make valid requests to the server and properly parse the responses?

Here are some questions for you:

• How many assumptions do you have about your API?
• Are these assumptions shared by client devs?
• All clients devs?
• Even ones who have never met you?

If your answer to any of those questions was “No” or "I’m not sure” then it’s likely that devs will need to ask you a thing or two about how to properly use your API. That's no big deal, right?

…You Didn't Afford It
In everyday life, if people have to ask how to use a device (television remote, toaster etc.) then you can be sure that device is “poorly afforded” – it's a case of weak design. We all know devices (especially electronics) that come with huge manuals and complicated explanations – and we all know what a bummer it is when that happens.

In this respect, your API is the same as any other consumer device. It should be “well afforded” – developers shouldn’t have to read the technical equivalent of War & Peace before they are able to successfully use your API.

Yes, you can supply detailed instructions in prose, provide a long list of possible methods, include lots of tables etc. These resources are helpful for devs but they can be daunting to read and cumbersome to maintain.

Another approach is to include this kind of information in a machine-readable format – and one that most devs will also understand quickly. This can be achieved by providing instructions (that get automatically updated whenever your API changes) via hypermedia controls in the response. Why write a Web page of documentation to tell devs to construct a URI and use that URI to execute an HTTP GET when you can just include that (and much more) information in your API responses?

Help your client devs out. Throw 'em a bone, here. Don't make them read pages of documentation when you can just include simple run-time instructions as they’re needed.

In conclusion: If they have to ask, you didn't afford it.

(Originally published on my personal blog.)

Layer 7’s March 14 webinar, ROI for APIs – which will feature input from TechCrunch and AT&T – should help to clear up some of this confusion. In particular, the webinar will focus on how hackthons can be used to gather valuable data for API ROI measurement.

How you measure your API ROI will depend on the purpose your APIs play in the greater business picture. Therefore, to provide a little primer for the webinar, I thought it would be helpful to give examples of a few API business models and how they might generate revenue.

• Per API Call
  Text messages sent via an API are billed at $0.01 per message
• Per API Payload
  Voice transcriptions via an API are billed at $0.01 per word
• Transactional Revenue
  An API call delivers a purchase
• Firehose API
  A monthly subscription provides unlimited API access
• Platform API
  An existing SaaS platform provides an API for partner integrations

To learn more, register for the webinar – ROI for APIs: Using Hackathons to Evaluate Your API Program featuring TechCrunch and AT&T.