What's In Store For API Management In 2024?

According to DataHorizzon Research , the?API Management market size was valued at USD 5.2 Billion in 2022 and is expected to reach a market size of USD 41.9 Billion by 2032 at a CAGR of 23.3%.?

Traditionally, API Management platforms have supported API design, development and testing, and at a minimum provide:

• Developer portal
• API gateway
• Policy management and analytics

Some of the advanced capabilities offered by leading platforms include enabling API-based business models, monetization, ecosystem management and automated governance.

In 2024, API Management platforms will likely continue to grow at a healthy, predicted pace. But there are some factors that may contribute to a breakout year. These include:

Harnessing the Rise of #GenerativeAI:

While API management platforms are not mandatory for #GenAI, they offer important benefits in terms of boosting control, enhancing security, and improving developer experience for generative AI development. Some of the key considerations for using a robust API Management platform for your GenAI applications include:

• Scalability: Generative AI apps often require significant computational resources. API management helps in scaling the application by efficiently distributing the workload, ensuring that the AI models can handle varying levels of demand.
• Resource Allocation: API management allows for effective resource allocation by optimizing the distribution of requests to different instances of the AI models. This ensures that computational resources are utilized efficiently, leading to improved performance and reduced latency.
• Security: Generative AI models can be valuable and sensitive assets. API management provides security measures such as authentication, authorization, and encryption to protect the AI models from unauthorized access and potential misuse. This is crucial for maintaining the integrity and confidentiality of the generative AI algorithms.
• Monitoring and Analytics: API management platforms offer tools for monitoring the usage and performance of APIs. This is essential for tracking the health of the generative AI models, identifying potential issues, and making informed decisions for optimization and improvement.
• Versioning and Updates: Generative AI models are subject to updates and improvements. API management allows for versioning, ensuring that changes in the AI models can be seamlessly integrated without disrupting existing applications. This is particularly important in a dynamic environment where updates to the generative models are frequent.
• Developer Collaboration: API management facilitates collaboration among developers by providing a standardized interface for accessing generative AI capabilities. It allows developers to easily integrate the AI functionality into their applications without having to understand the intricacies of the underlying models.
• Monetization and Access Control: For organizations offering generative AI services, API management enables effective monetization by allowing them to control access to their models. Through usage plans, rate limiting, and access controls, organizations can implement various pricing models and manage how users interact with their generative AI APIs.
• Error Handling and Reliability: API management systems provide mechanisms for error handling and ensuring the reliability of the API. This is crucial for generative AI applications, where errors in inference can have significant consequences. Proper error handling and reliability measures contribute to a more robust and trustworthy user experience.

Monetization in an API-First World:

The need to monetize APIs will drive a lot of customers to adopt a more robust API Management platform, or expand their usage to include monetization.

A recent Postman survey asked respondents, “Do you view your APIs as products?” Almost 60% of respondents said yes, 26% said no, 15% weren't sure.

Companies with a large developer headcount were the likeliest to view their APIs as products, with 68% answering yes. Among industries, people working in financial services were the most likely to consider APIs products.

Further, when asked whether their APIs generate revenue, 65% of respondents said yes. Of those answering in the affirmative, 43% said their APIs generate more than a quarter of the business's total revenue.

For a handful of companies, APIs generated more than 75% of total revenue. These companies were almost twice as likely to be in financial services as other sectors.

Commercializing your Data Assets and Distributing Data Products:

With the explosion in data produced by technologies like IoT, system and application logs, customer journeys, AI/ML models and others, the use of #datawarehouse and #datalakehouse technologies has grown manifolds and have resulted in data marketplaces for delivering/distributing data to their consumers (global data marketplaces are poised to reach $3.5 billion by 2028).

APIs are not only a great way of providing standardized access to systems like data lakehouses or analytics hubs, they are also a critical enabler of data products (digital products or services built using data as a core value proposition), a core component of any data sharing system. APIs provide a standardized way for different applications to interact with the data product. For example, an API could be used to allow a mobile app to access data from a weather forecast or a recommendation engine data product. Beyond data products, APIs also provide easy and standardized access various data management platform. ("Hype or Trend? 7 API management use cases rising in prominence" by Vikas Anand and Geir Sjurseth, Google Cloud )

API Security Concerns will Drive Serious Customers to API Management Platforms which Inherently Address Security:

In past one year, 94% of respondents have experienced security problems in production APIs, with 17% having experienced a breach. (The State of API Security Report by Salt Security)

It’s no surprise that respondents lack confidence in the security aspects of their API programs. Nearly half of respondents cited security gaps as their top concern, with 23% each citing inadequate runtime or production security and insufficient investment in pre-production security.

This trend ushers in the need for forward-thinking organizations to 'Shift Left with Security' — moving controls earlier into the production workflow — by bringing security teams and API teams closer. To stay ahead of security threats, many organizations are actively looking for solutions that allow them to be proactive while minimizing the burden on their security teams. According to Google Cloud 's research, integrating capabilities that proactively identify security threats (60%) is top of mind for most IT leaders for the next year. ("Hype or Trend? 7 API management use cases rising in prominence" by Vikas Anand and Geir Sjurseth)

The Upgrade Cycle Driven by Move to Cloud / Hybrid Cloud:

As with other software products, the benefits of a SaaS or Cloud based API Management Platform are increasingly obvious, and include:

1. Scalability: Cloud platforms provide scalable infrastructure that can easily accommodate varying levels of API traffic and usage. As the demand for API services grows, organizations can seamlessly scale their API management infrastructure in the cloud to handle increased loads without the need for significant upfront investments in hardware.
2. Cost Efficiency: Cloud-based API management offers a pay-as-you-go model, allowing organizations to pay only for the resources they consume. This eliminates the need for large upfront capital investments in hardware and infrastructure, making it a more cost-effective solution, especially for businesses with fluctuating workloads.
3. Global Reach: Cloud providers have data centers distributed globally, enabling API management platforms to be deployed close to users and clients. This reduces latency and improves the overall performance of API services, ensuring a better user experience for a global audience.
4. Flexibility and Agility: Cloud-based API management platforms provide greater flexibility and agility. Organizations can easily deploy, modify, and update APIs without the constraints of physical infrastructure. This agility is crucial in the fast-paced development and deployment cycles of modern applications.
5. Integration with Cloud Services: Many organizations are already leveraging various cloud services for different aspects of their operations. Cloud-based API management platforms can seamlessly integrate with other cloud services, such as identity management, authentication, and analytics, enhancing the overall functionality and capabilities of the API ecosystem.
6. Security and Compliance: Cloud providers invest heavily in security measures and compliance certifications. By leveraging these cloud security features, organizations can enhance the overall security of their API management platforms. Additionally, cloud providers often offer tools and services that facilitate compliance with industry regulations.
7. Managed Services: Cloud providers offer managed services for API management, handling tasks such as monitoring, scaling, and maintenance. This allows organizations to focus on developing and improving their APIs rather than managing the underlying infrastructure.
8. Easier Collaboration and Integration: Cloud-based API management facilitates collaboration among distributed development teams. Developers can work on API development and management tasks from different locations, and cloud-based platforms often support seamless integration with popular development tools and workflows.
9. Automatic Updates and Patching: Cloud providers manage the underlying infrastructure, including updates and patching. This ensures that API management platforms running in the cloud benefit from the latest security patches, features, and improvements without requiring manual intervention.

As cloud adoption itself has reached critical mass, increasingly the newer advances in API Management are increasingly being offered only in the Cloud versions of the products.

Leaders in API Management - like Google Cloud #Apigee have come up with Hybrid approaches that offer the best of both worlds - an API runtime plane consisting of the Gateway and other runtime components running on-prem, close to the enterprise workloads, while the control plane that consists of a set of Google-managed services to enable full-lifecycle API management is always hosted on Google Cloud Platform even if the runtime is deployed on premise or on another supported cloud platform. By leveraging a proven cloud stack, the control plane provides many operational aspects of an enterprise API management solution as well as scalable control mechanisms. (Apigee Hybrid - The benefits of a managed control plane and what that really means, https://tinyurl.com/47hpc637)