Start Up Blog

The open API secret

Posted in entrepreneurship by Steve Sammartino on January 18, 2012

The biggest flip the technology age has done on the industrial era is the open API. For the uninitiated, an open API (Application Program Interface) is a word used to describe sets of technologies that enable websites to interact with each other. It is also a system where web companies ‘open up’ their platform for external non affiliated software developers to create applications on. Facebook most famously did this with their ‘Facebook Platform‘.

While this sounds like some kind of nerd nirvana, it is actually a counter intuitive move that forms a large part of the marketing genius of social web 2.0 applications. And that is outsourcing the R&D to total strangers. That is, entrepreneurs who have new and interesting ways to mash up their content. It is quite revolutionary in fact. Corporations from the pre-web industrial era would rarely let people use their logo, let alone open up part of the factory for hackers to come in and try and build something interesting. But this is exactly what is happening, the most amazing stuff is usually coming from external organisations and the entire ecosystem is the beneficiary.

  • Existing web companies get their new product development for free
  • Entrepreneurs get a shot at being acquired by the firms whose API they focus on

The open API idea has to be one of the major reasons why technology companies are eating the world. The only question remaining is why don’t old world industrial companies open up their doors to some new, fresh and external innovation?

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9 Responses

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  1. seancallanan said, on January 18, 2012 at 8:42 am

    Very topical Samma, did you see CBS Sports has opened up an API to it’s sports fantasy platform for that same reason. – http://online.wsj.com/article/SB10001424052970203721704577159270507577072.html

    • Steve Sammartino said, on January 18, 2012 at 9:24 am

      It seriously is the smart play for brands today…. Why invest in ‘New Product Dev’ when others can do it for us at their cost and we only pay for the winners? (via acquisition). The only curiosity for me is why more companies who actually ‘make stuff’ don’t do it more often…

      Steve.

  2. Tim Lovitt said, on January 18, 2012 at 8:50 am

    Agree it’s been amazing of late – but it also reminds me of the early days of personal computing where msoft had their first wins when hardware manufacturers inadvertently outsourced their software dev, the chipsets having in effect an open API.

    As such, how do we keep it at this stage, when everything is new and doable. Or will it always be, now that the resources for innovation are so much more accessible?

    Sometimes i think too much.

    • Steve Sammartino said, on January 18, 2012 at 9:20 am

      Tim, I reckon it will stay this way because the new age has less physical resources, and more intellectual ones… it lends itself to reduced protection and boundaries. I hope we stay ‘open’ for the sake of human innovation and the plight of the species….

      We ‘both’ think too much.
      Steve.

  3. Ben Rowe said, on January 18, 2012 at 8:39 pm

    It’s also a really smart way to spread your online brand.

    I think the way Instagram have done it recently was a very clever move, and as a result you see offline products (photo printing, fridge magnets, etc) that can be ordered online, via spin-off businesses and their API.

    As a result, it increases awareness of instagram.

    Clever.

  4. UK Courier said, on January 19, 2012 at 5:54 am

    The CBS fantasy sites need a lot work, their too hard to navigate in and they make setting a lineup brain surgery at times.

  5. Why Statigram rocks « Start Up Blog said, on January 24, 2012 at 9:36 pm

    [...] few days ago I blogged about the serious advantages of embracing an open API. And just recently I’ve come across another great example of an startup using it to full [...]


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