One important business reason to enable APIs in your business is to monetize¬†your business capabilities. For example, if you are a credit reporting agency and¬†you produce an API that establishes credit scores and facts regarding a¬†consumer’s credit history, then many banks, loan companies, insurance¬†companies, and solicitation companies would be more than happy to use¬†(consume) your API for money. It provides them with the ability to perform the¬†API functions, yet avoid having to develop and maintain their own API functions.
In addition, they can easily disconnect yours if a better one comes along. This is the differentiator for APIs in an API economy: the ability to quickly subscribe to or unsubscribe to business functionality. It makes business more agile by driving a healthy competition for business function.

The term API economy refers to the opportunities associated with productizing the exposure of your business functions as APIs. Consider that your API is a consumable product, and you need to market and position your product correctly for maximum profit. So API economy deals with the additional channel opportunities associated with the proper exposure of your consumable business functions.

As part of the API economy, it is also needed to understand the role of API¬†marketplaces. Think of API marketplaces as ‚Äúapp stores‚ÄĚ for APIs. Many different¬†marketplaces will evolve, from public, to private, to business partners. These¬†marketplaces offer a variety of capabilities including multitenant. Business¬†partner exchanges are good examples of multitenant. Multiple business partners¬†can have access to API catalogs with search and access capabilities being¬†based on the authorization of a partner.

You can also read more on what API economy comprises and how IBM reference architecture encompasses the entire API economy in this document.

To learn more please read the Redbook here.

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