Saturday, February 11, 2012

Thoughts on the "Apps Economy", "Open Data" and the Value of APIs

To quote my friend Stevie Chambers (@stevie_chambers), "I feel like a new room has opened in my memory palace."

That was exactly how I felt after finishing my recent The Cloudcast (.net) podcast with Sam Ramji (@sramji) and Christian Reilly (@reillyusa), where we discussed the role of APIs in the economy of mobile devices and "open data". I had heard that Sam was brilliant, but hearing someone articulate both the business and technology value of APIs the way Sam did was a lot like listening to Chris Collinsworth explain line-play during an NFL football broadcast. You think you have some idea how things work and then they show you the "behind the QB angle" and you realize that a new door of complexity has been opened up to you. All I can say is wow!! There is an incredible underground economic environment living behind the mobile devices and apps that have become such a critical aspect of everyone's life.

I'd encourage everyone to take 45 minutes and listen to the podcast - not for selfish reasons (we make $0 from the show) - but for pure education purposes. It'll open your eyes to the incredible power of the "apps ecomony" + "open data". I've gone back and listened to it 3 times now and am learning little nuanced things each time.

Here's some of the highlights and key points I took away from the discussion, as well as some areas I now want to go explore.
  1. The movement from a link economy to an "app economy" that is driven by "open data". There are lots of ways to look at it, but it ties very closely to Dave McCroy's concept of "Data Gravity" and the blog I had last week about Planet Data. The linkages and networks are still incredibly important, but the information behind them is driving a ton of new business opportunities.
  2. "Open Data" might be the black mamba companion to the "Big Data" movement, where unlocking data is potentially creating more (or faster) near-term value for more companies than the PhD-laden data scientist path.   
  3. Mobile environments like iOS and Android are allowing us to create a business experience where the critical asset is the API; where there can be 100s of Apps accessing the same data (or "throw away apps") and we move from building silo'd applications to managing platforms (data + APIs). 
  4. If done correctly, a proper API + Data platform strategy implicitly links the business process to the technology.
  5. If your business manages many partnerships that change throughout the year (or year to year), it will be critical to understand an API strategy to allow that model to become efficient. 
  6. We'll begin to see more and more companies unlock their previously "closely guarded" data in ways that allow them to enter new markets, or expand existing markets. "An API request for your data will become the new, real-time market research".
  7. "Open Data" is not only about using open-standard (and open-source implementation) protocols, but also about rethinking how a company values their data and the potential that comes with opening it up to new markets or new partners.
  8. The 2nd-generation companies building the framework for the open data economy are still in early stages (Apigee, Mashery, Programmable Web, InfoChimps, etc). Google being the poster-child for the 1st generation companies.
  9. We may hear of business managers in the near future bragging to their colleagues that they made their quarter because of their investments in an API strategy.
To say that I'm excited about exploring this new economic space is an understatement. I'd love to hear others thoughts about this space, or good resources you've found to better understand the markets.


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