Everything you need to know about the API economy

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The API economy is changing the world. But will it change edtech?

True innovation transcends barriers such as time, place or culture. From prehistoric plows to ancient aqueducts to steam powered engines  – when viewed in context, a good idea can bond people through a shared appreciation of its ingenuity and impact. However, without context, it’s easy for even the most brilliant ideas to lose their sparkle.

Lack of understanding is certainly one issue having a big impact on many of today’s most brilliant innovations – a huge number of which are technology based, meaning they often remain inaccessible to non-technologists.

In spite of this, even the most dedicated Luddites among us would be hard-pressed to ignore the spate of advances that technology has afforded in areas such as communication, finance, entertainment, or travel. In fact, if you own a mobile device (and there’s a strong chance you do, given that over three-quarters of American adults own one), then you probably use lots of applications every day. For example, you might use your phone when looking for directions. Or maybe you use a fitness app to monitor gym activity. Perhaps you use your device to share images with friends, or get the news, or bank online.

Living in an Interconnected World

The ease with which you can perform any of these tasks is a testament to just how intuitive their design is. It is also because they are designed to work together so that you can put them to use anytime, from just about anywhere. The thing that makes this integration possible represents one of the modern era’s greatest, and possibly least well-known, innovations – the API.

What is an API and Why Should I Care?

The API acronym stands for Application Programming Interface. It’s not the most exciting name in the world, which is a pity because APIs enable some truly exciting possibilities.

But before we get into those, let’s try give them some context.

Though they’ve been around for some time (some would argue that they’ve been around in some form since the time of the ARPANET, the forefather of the Internet), APIs have not come close to entering the public consciousness until relatively recently. For this we can thank the rise of mobile devices along with a corollary increase in the use of social media  – both of which were pivotal in accelerating the popularity of apps, which we use daily to do all kinds of weird and wonderful things.

However, without APIs there would have been no such surge in popularity. In fact, there might not even be any functioning app economy at all, as pointed out by Ian Clarke in the Computer Business Review:

“APIs are the unsung heroes of the application economy. Applications wouldn’t exist without them.”

The truth is that without APIs the apps we all use everyday wouldn’t function as we’ve grown to expect. There would be no integration, no fluid user experience, and, well, no point really. Which brings us to the core of why APIs are so important –  they’re built, in essence, to allow services to communicate with services.

It’s a purpose that becomes pretty clear when you think about the API name again: application programming interface – that is, an interface between apps. To look at it another way, an API essentially performs the role of helping two strangers speaking different languages to communicate with each other.

Who uses APIs?

This is where things start to get interesting. Because APIs perform a communicative function between apps with potentially disparate codes, they create endless possibilities for integration and innovation across industries and user types.

APIs are the unsung heroes of the application economy. Applications wouldn’t exist without them. Click To Tweet

The huge value that this flexibility offers is clear from even a cursory glance at some of the companies employing APIs as a cornerstone of their service: Facebook, Twitter, Google, Salesforce, Spotify, Uber, Netflix, and Stripe. Obviously, this tiny list includes some giant companies, but would any of them be as successful if APIs didn’t let them freely integrate their features with myriad other companies and platforms around the globe? Most likely not – but because they were quicker to leverage the potential of their APIs than everyone else, they gave themselves a major head start on their competitors.

As a result, companies are no longer treating API development as merely an area of high potential; they are prioritizing it as part of their strategic business plans. In fact, one global study has found that 82 percent of businesses in the UK have already done so, with one-fifth using APIs to drive their revenue growth. In addition, those that have incorporated APIs as part of their business strategy also report a huge increase in customer satisfaction and a dramatic reduction in their IT spend.

What are the Benefits of APIs?

But that’s just business – what about the actual benefits to real people? And what does any of this mean for the edtech industry?

As implied, APIs allow companies to scale quickly by syndicating their products and increasing their audience reach. For developers and users, however, they open up near-endless possibilities to transform day-to-day activities. As ProgrammableWeb (a tech news and repository site) put it, the potential of APIs “is limited only by the imaginations of developers and the capacity of the API provider’s infrastructure.”

By bringing systems together, APIs give users a sense of effortless mobility. Their simplicity makes all kinds of services instantly accessible. Customers gain massive benefits from speedier development cycles since the applications they use are constantly evolving behind the scenes, thereby offering a tangible sense of moving with change rather than resisting it.

Working Better by Working Together

Because APIs allow developers to pull and re-use data from other sources, they make collaboration much easier. Used correctly, APIs allow the best ideas to rise to the surface far more quickly.

Yet APIs are still products – or more accurately, interfaces to products. The companies that create them must invest considerable resources into developing, securing and managing their APIs. This is vitally important since no third-party developers will want to waste their time building a new product if they cannot trust the APIs they are using to give access to it.

The potential of APIs is limited only by the imaginations of developers. Click To Tweet

API creators must therefore also spend a huge amount of time ensuring that their products are compatible with other third-party software. This is especially important because of the fact that many organizations may not have the internal resources to manage a smooth software integration, nor the necessary skills to scale usage or gain maximum value from the APIs they are using. For integration to be successful, both sides must be properly prepared; but when they are, APIs allow companies to accomplish more together than would be possible if working independently.

Are APIs Secure?

As with many a bank heist movie, the most impenetrable fortress offers the richest rewards, which means that there will always be someone on the outside plotting their way in.

With any new technology, there comes some degree of risk. It’s unfortunate, but that’s just the way things are.

The spate (not to mention scale) of recent cyber attacks prove to us that no matter how well-resourced a company, there always remains some level of vulnerability, however minute. Because of this there is something of a perpetual footrace on between security experts and hackers.

Yet as the API economy grows, companies are investing more of their resources into their security strategies. The evolution of the API economy will coincide, by necessity, with the evolution and tightening of data security practices, which is most certainly a good thing.

The API Economy and the Future of Education

In spite of their popularity, the use of APIs in education is still pretty low, at least when compared to other industries. This isn’t too surprising when you consider that just 3 percent of spending in education goes towards digital compared to 35 percent in other content-based industries.

As a result, few schools or district admins are equipped with the resources to successfully transfer data between different systems. When this kind of obstacle strikes in the business world, there is always some entrepreneurial spirit waiting in the wings to develop a solution. While it’s been a more sluggish process in education, the solutions are steadily beginning to emerge and gain recognition.

There is still a long way to go but vision often precedes action, so let’s take a moment to imagine how future edtech innovators might put APIs to use to enhance the learning experience.

Let’s begin by picturing a high school student aiming to learn more about the American Civil War. Say she wants to better understand the timeline of events, their import and order, but is finding it difficult. The student takes a test on the key battles of the Civil War. The data is fed back into the cloud and an integrated software gives the student further options to watch some short videos detailing the Battle of the Ironclad between Monitor and Merrimack, or browse related visual materials such as infographics or VR tours on the conflict.

APIs will allow developers and product managers create a better learning experience. Click To Tweet

Later, the student is given the option to join a live discussion on the topic with fellow students from around the country. Afterwards she retakes the test. Her score is processed and the learning materials she’s used are awarded scores based on their learning impact. In doing so, students with similar difficulties can later be offered similar solutions – or others – until the system locates the content that works best for them. This is also shared with teachers, who can discuss the best-performing content in class with their students, reinforcing key points.

All of these separate actions could be provided by a number of apps, owned by different companies – yet the APIs act as points of integration, transforming raw data into a series of communications. Without them, developers or product owners would face the monumental task of having to create such an open ecosystem on their own, and thereby risk falling prey to the perils of ignoring the lessons of the past.

Though the imagined scenario above is admittedly not the most progressive vision of education’s future, that is beside the point. Someone else’s vision will be; and it will be the role of APIs to allow developers and product managers to realize and refine their vision so as to create a better learning experience. As long as users remain at the heart of the process, such aspirations are bound to eventually become achievements.

A version of this article originally appeared in the Edtech Digest.

Micheál Heffernan

Senior Editor

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