API companies are hot properties

Just today CA Technologies announced that it acquired Layer 7, an API management company, making Layer 7 the second acquisition this week after Intel bought Mashery. For those not familiar, API stands for application programming interface and describes the interfaces used by software components to communicate with each other. For software companies, an API is the way the outside world interacts with their products beyond an operator using a user interface.

So why is API management so hot right now? Partly because of cloud computing’s rise. Suddenly, it matters enormously to have ways for the rapidly expanding number of cloud offerings to communicate with each other and with the organizations signing up for their services. API’s are key to business applications used int he cloud but also to the many kinds of web communities like Flickr, Facebook and Twitter.

API’s also allow embedded content like Slideshare and widgets within WordPress. Effectively, API’s provide the critical links that make cloud computing work. Keep in mind that with data growing exponentially, big data is also driving the need for more powerful API’s.

Complexity and security

Intel and CA acquired API management companies because the Web presents new challenges to businesses around security, reliability and manageability of their interfaces. The cloud makes business interfaces even more important and more vulnerable than ever before. More recently, the proliferation of mobile apps that connect to one or many applications across the cloud put even more importance on API management. A great example would be Google Maps, a stand-alone application that is also used alongside Yelp and many other location-based apps. The data that has to move very quickly between Yelp and Google Maps is managed through API’s.

Internal and external

API’s aren’t just for cloud, even those use cases are accelerating at the highest rates. They’re also used to allow internal applications to be loosely coupled and for data to flow between large systems like SAP with purpose-built mobile apps and websites. What used to be custom code can now be accessed through published API’s instead in ‘private clouds’.

The acquisitions of Layer 7 and Mashery are a telltale for the continued rapid expansion of connectedness…of people, sensors and applications and all that data they share.