Do APIs make Money?
In line with vast technological disruptions and advancements, many tech giants have become genuinely more curious about APIs. Gone are the days that “APIs” used to be just a buzz word. More and more enterprises are now making an effort to join in the “API-fication” process. Some telcos too have started to follow the footsteps of those early adopters who have already incorporated APIs into their businesses. Nevertheless, failing to grasp the gravity of the strategic decision taken to join the API bandwagon, is going to shake the very roots of the whole business in the long run. Telcos needs are to increase their revenues and overcome revenue pressure in the digital services sphere to be sustainable. The question is how do APIs make it possible for telcos to earn recurring revenues? Is it really possible for telcos to make money by just merely opening up APIs? The answer is No. Leveraging telco assets to spearhead competitive advantage is not solely dependent on opening up telco APIs.
Innovation by All
It is not the APIs that make money; it is the services that are going to drive new revenue into telco businesses. Extending innovation capabilities focusing on easy and rapid service creation is how telcos are going to reach this milestone. In doing so, it will be necessary for Telcos to build a service innovation layer on top of their API Management platform to enable seamless service creation for developers who use APIs to code their way through services as well as for non-developers and enterprises who may not have prior coding knowledge. This will in turn build up a complete eco system enabling service innovation for Telcos! Service innovation should become a dominant topic even among the parties with no prior coding knowledge –the Non developers! Extending innovation capabilities even among thriving enterprises will result in these business entities to gain seamless sophistication in creating new services on top of telco assets.
Telcos need to aid intense service innovation backed by smooth and consistent service creation possibilities, be it from self care, end to end service creation environments facilitating developers with rich set of tools covering the entire app development life cycle to providing opportunities to a wider community of non developers and enterprises to create Value added services through App creation wizards, pre-defined app patterns, drag and drop components; industry specific app templates etc. Such measures of widening the spectrum of app creators will result in proliferation of services which will in turn create new revenue streams for telcos.
Not only will those innovative new services be generating high earnings for telcos but they themselves also will be able to adapt to the ecosystem to create services that improve their internal efficiency. Time and resources which would have been the bottleneck for telcos to create these new services. Now will be the time that they too can vastly reap the perks of telcos digital assets.
Engagement with App Creators
Furthermore, building a sustainable ecosystem (VAS ecosystem) with a wider spectrum of app creators, and nurturing them through engagement over workshops, webinars, and hackathons etc. will undoubtedly – create a solid foundation of a next generation of successful entrepreneurial app creators!
It is clear that the number of API calls you get to your network is not going to straighten out how telcos are going to stay ahead of the game. Telcos need to rethink the business model of the traditional API management platforms. It should not be about counting the number of APIs to charge the app creators any more! Telcos future business model should be such that these developers, non-developers and enterprises can monetize and earn revenue creating compelling new value added services whilst building sustainable businesses. Opening up new business opportunities by persuading them to become true entrepreneurs of the next generation is how telcos are going to reap the full potential of their existing network infrastructure. For telcos future defiance of overcoming revenue pressure and having a sustainable business model is all about going beyond APIs and advocating service innovation by all!