Digital Media Buzz > The Year of the API

The Year of the API

By Ron Callari

2009 will probably go down as the year of the open source API. An application programming interface (API) is an interface implemented by a software program to enable interaction with other software, much in the same way that a user interface facilitates interaction between humans and computers. Open source APIs allow third-party developers outside a company to develop apps for a client website.

Google’s OpenSocial was one of the first to work with open source APIs. It standardized its own API for “containers” to easily implement the same API across multiple sites. Facebook and Twitter did the same with their platforms, and in November, LinkedIn, one of the largest business-oriented social networks finally launched a two-way integration with Twitter and opened up its API to allow for third-party developers to tap into its vast exchange.

Location-based social networks, which also made their mark in 2009, learned quickly from their predecessors and are steadily adding useful features that help transcend their platform’s technology with innovative applications. Foursquare, the popular game-like location-based social network, in an attempt to scale faster than its competition, signed up 10 third-party APIs after they issued the following welcome to developers on their website: “You can use the API to create new ways to check-in to Foursquare or visualize the data generated by the Foursquare community. Our API is still a work in progress and we look forward to your feedback.”

In the eyes of the more conservative social media players, adding ‘location’ to the API mix is a somewhat controversial component. While Facebook is looking to dominate the mobile medium space as successfully as it has with its Web apps, it is being cautious about the privacy issues when users communicate their coordinates (longitude and latitude). According to Dominique Bonte, ABI Research’s principal analyst in telematics and navigation, “location-based advertising is going to be the driving motivator for Facebook to get involved once they resolve their privacy guidelines.”

In 2010, third-party developers may gravitate quicker to location-based social networks over traditional social networks due to the greater monetization opportunities. Chris Hallgren, third-party developer and founder of Hallgren Networks, recently developed myKite for the location-based network Brightkite. The myKite app is a social networking tool for Blackberries that is geared to facilitating meeting people based on the places you go. The fact that it ties into other existing social networks - like Twitter and Facebook - means myKite will complement with, instead of compete, those more popular social networking platforms. According to Hallgren, he also thinks “due to advertising, and how ‘location’ provides so much information about the end user, it provides a very targeted advertising platform.”

With other location-related products, Bonte sees Personal Navigation Devices (PNDs) falling behind in the API race. “With devices like Tom-Tom, as a self-contained system, their platforms are presently closed,” he notes. “By opening themselves up to APIs, these companies would be able to enrich and enhance their product offerings,” Bonte adds.

Looking to the future, while reach and revenue are goals, there is a delicate balance between novelty and long-term usage. This makes retention a key factor. While apps traditionally experience a high level of initial downloads, it’s more important that the app has stickyness. Whether or not the apps are free or paid, getting users to keep launching an app is the key to its success.

Greg Yardley, CEO of Pinch Media, offers some stats based on the 30 million+ downloads his iPhone app analytics startup has followed. One of the most telling points of his research is only about 20 percent of users return to use the app the first day after they download it. And that number quickly drops off from there. By 30 days out, less than 5 percent are using the app.

For third-party developers, many develop APIs that are free and hope to monetize with advertising once they’ve come out of beta. As noted by Hallgren: “Right now myKite is 100-percent free with no ads. In the future, I plan to provide a paid app with more features but that time hasn’t come yet.”

According to Yardley, “For all but the most successful apps, the free route does not make much sense because there is not enough time to recoup the costs of developing the app from advertising.” On the other end of the spectrum, to bombard users with excessive advertising is most likely a turn off for users.

Google believes in offering everything free, and Bonte sees the search engine giant making major strides in 2010 in the navigation app arena. Since they own and control their own location-based social network Latitude, coupled with search engine prowess in local search and their newly acquired real-time search feeds from Twitter and Facebook, they are in a prime position to seize opportunities in growth and acquisition.

Once APIs are established, social networks like Twitter and Facebook can consider acquiring them. But what is the decision-making process? According to Bonte, “Price is important and looking for affordable deals.” But even more important is whether or not the larger networks have the capability to develop the API on their own. Bonte notes that it takes, “a lot of due diligence where double and triple checks are required to determine the viability of the product for the company.”
One of Twitter’s smartest moves to date was acquiring Summize, the real-time search API that filters and interacts with the volumes of news and information transmissions to Twitter, every second. It was that monumental decision that not only positioned the microblogging platform as a viable source of news, it also prompted Google to strike a deal to obtain that feed for its own search results.

2010 will be a year of integration for open source API. Ravit Lichtenberg, founder and chief strategist at Ustrategy.com, believes that “social media will no longer be ’social media’ - it will be an integrated, unquestionable component of your online and offline experience.” Since open APIs and OpenID made that possible - “2010 will be about integration and a single, cohesive experience across platforms as well as across products and services - Web, mobile, TV and video - will be become near-inseparable experiences,” he adds.

As apps continue to evolve, APIs will become more robust and more transparent. With 50,000 registered applications to date built for Twitter alone and announcements to open up its firehose of real-time updates to everyone in Q1 2010, rest assured that app developers will be lining up for the opportunity.

The exponential increase in third-party developers will be most evident as a result of increased attendance expected at developer conferences for Twitter and Facebook. On April 21-22, Facebook will launch its Open Graph API at its two-day developer forum, and Twitter’s Chirp Conference in San Francisco (TBD) has already launched a dedicated page for the conference where users can sign up for updates. If 2009 was any indication of the importance of APIs, it appears that events like these are going to make significant strides in prompting future enhancements in the years to come.