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The risks and rewards of the age of APIs

Paul Krill | Nov. 13, 2013
The Age of the API is upon us, presenting developers with new opportunities to generate income by linking to the data and services of others. But developers need to be careful when navigating the new API landscape.

PayPal's APIs had become complex and in some cases redundant, creating integration difficulties for developers. Then PayPal reworked its APIs to focus on JSON, REST and Oauth earlier this year, using a standard API model. "The new REST APIs offer all the same functionality in a simple, consistent way," says Deepak Nadig, PayPal's director of platform engineering.

APIs come from all sorts of industries
Mobile and cloud technologies are major drivers of the increasing number of APIs, as they let developers link customers to services residing on clouds and funneled to devices -- a reflection of the connected, heterogeneous reality of today's computing as compared to the old enterprise model of closed, complete systems. An Apple iPhone application, for example, might access an online merchant, PayPal payment services, and FedEx shipping services, Nadig says. As a result, "every company is feeling the mandate for them to expose APIs."

Participants in the burgeoning API landscape come from a variety of industries. Walgreen's, a $72 billion pharmacy chain, is counting on APIs in a big way in its e-commerce efforts: Its APIs lets both Walgreen's own app and others' applications order prescription refills, for example. As a result, those APIs are used to refill a prescription every second, says Joe Rago, a senior product manager for the Walgreen's API program.

Walgreen's also has an API for its QuickPrints photo-printing service, which gives third-party developers a 15 percent cut of net sales. Additionally, the company offers an appointment-scheduling API and its own software development kit.

Financial services provider Tradier has built its business by giving third-party developers APIs for cloud access to trade data, trade execution, and market access. Developers use them to build applications such as algorithmic and robotic trading systems.

Even the federal government has gotten into the act. Independent consultant Lane has been working on claims-processing APIs for the U.S. Department of Veterans Affairs. He's also worked with the Census Bureau and other federal agencies on API strategy.


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