Is the Next Wave of Digital API Adoption on the Horizon?

This post is co-authored by Ritwik Chatterjee, Global Practice Leader, Digital API Services for Dell Digital Business Services

The likes of Google, Amazon and Facebook reintroduced us to Application Programming Interfaces (APIs) in the incarnation we know today. At that time, APIs seemed to be something of use only for the hi-tech, dot-com companies that didn’t have confidential data or high-value transactions at stake. The primary driver, in that case, was ease-of-use and access.

The second wave adoption was when enterprises took a serious look at APIs and started using them in innovative ways for customer, partner and developer engagement. Digital transformation and mobility were the key drivers. For many enterprises, it became a differentiator. APIs were also used as a means of competing with disruptors.

While the second-wave adoption continues to grow — especially with the renewed interests in APIs from IoT and wearables — we, at Dell Digital Business Services, believe that the third wave of API adoption is coming, and will be much larger than the earlier waves. This time, API adoption will be driven by industry standards and government regulations.

The Second Payment Services Directive (PSD2), the U.S. Healthcare Meaningful Use Act (Phase 3), and the New Distribution Capability (NDC) standards are all examples of government regulations and industry standards that encourage the democratization of data to nurture healthy competition, foster innovation and deliver better business outcomes. While these regulations do not explicitly mandate the use of APIs, it undoubtedly is the most appropriate technology to implement these standards.

The rules of the game will be different during this third wave. For one, API adoption will no longer be a matter of choice, but a mandate. Though early adopters will have a head-start in this game, simply having APIs will no longer be a differentiator. Organizations will have to find ways to build value, and monetize their assets to stand out from the pack.

Security will remain the biggest concern. With APIs, enterprise firewalls can no longer safeguard corporate and customer data as they are opened up for consumption by third parties. Weak links will emerge. Organizations (especially those new to the discipline), will need to quickly learn API intricacies and deploy technologies and processes that can manage API security incidents. This will be essential to continue to maintain customer trust, and avoid legal and financial fallouts.

Another potential challenge will be the choice of tools. The API products and tools market is flooded with tools that could potentially help in all aspects of the API lifecycle. Selecting the right set of tools that can cater to the organization’s specific needs will not be an easy task, especially for those just getting started. Further, consolidation in the tools market can mean uncertainties for both existing and new users.

Finally, there will be increased stress on operations. APIs are not only going to be business-critical, but also have legal, regulatory and financial implications. API usage, availability and performance will come under higher supervision. We expect minimum standards to be laid down by the governing bodies, but the pressure will be on to move the needle higher. Because of the criticality and volume of API interactions, we expect the business and technology operations teams supporting these APIs to have a very high visibility within the organization.

At Dell Digital Business Services, we believe that in order to ride this new wave of Digital APIs the best way forward is taking a business-first approach. Our service offerings are well-equipped to help our customers in their digital adoption journey, and help them with new business models, enhanced revenue and operational efficiency.

About the co-author:

Ritwik ChatterjeeRitwik Chatterjee loves APIs. He leads the Digital API Services practice at Dell Digital Business Services and has over 16 years of experience in IT consulting, solution architecture and delivery for global Fortune 500 clients. Ritwik helps define API and Microservices strategy and architecture for his clients. He also builds applications and solutions that deliver scalable, performant and developer friendly APIs to address key pain points of his clients.

Ritwik is also an avid blogger and an active speaker at industry forums and conferences on APIs. He holds a master’s degree in technology from the Indian Institute of Technology (IIT), Delhi. His interests are APIs, microservices, cloud computing and digital transformation.

About the Author: Chethan Gorur