APIs and the Creation of Wealth in the Digital Economy

Democratizing Value Creation and Distribution in the Second Machine Age

Steven Willmott, steve@3scale.net @njyx

Who Am I?

• Steven Willmott• CEO of 3scale• Leading API Infrastructure provider: 700+

Customers, billions API calls Month• Our Mission: Enable companies and

individuals to unlock the power of their APIs

http://www.3scale.net/ @3scale and @njyx on Twitter

The Next 20 Minutes

• The Power of APIs• Why it is critical that benefits are broadly

accessible • What you can do to lean on the scales to make

change

Background

The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies, 2014, Erik Brynjolfsson, Andrew McAfee

The Price of Inequality: How Today's Divided Society Endangers Our Future, 2012 Joseph E. Stiegliz

APIs and Scripting: The Future of Creativity In The Second Machine Age: http://bit.ly/apiage

THE POWER OF APIS

APIs are the Ultimate Levers of Power in the Digital World

< Read, Submit, Edit, Ship, Activate, Learn, Infer, Process, Pay, … >

APIs form the Infrastructure for Automation

Climate

Home

Transport

News

Safety

Social

Political

Food

Question: Is all this automation a “good thing”?

Answer: It depends…

For API Providers: Yes!

For everybody else, a key question:

Are they pure Consumers of Value or are they Creators of Value?

Consumers v’s Creators

Consumer• E.g. Uber rider: I am a

consumer of the API• I get value• It helps me achieve a

goal• I’m willing to pay for the

achievement of that goal• BUT I am not a creator

Creator • Create new value with

an API (personalize, improve, augment)

• Offer that value to others

• I may pay, but I may also get paid

• I can enhance my business in some way

Who are the users of your API?Who benefits from it?

In this World…

Most users obtain value

But most of the wealth goes to the companies / individuals that create

complex apps

Why does this matter?

Because the ability to create value is inherently intertwined with Economic

Opportunity

Software is Eating the World

Done right: this is fantasticDone wrong: this is a disaster

Two Problems

1: Concentration of Wealth2: Under delivering on our opportunity

HOW APIS AND AUTOMATION WILL CHANGE THE ECONOMY

A Glimpse of the Future

Amazon Echo A Voice UI for the World

“What’s the distance to CDG”

“Where is the nearest Bakery”

Florists

Atelier Green Factory17 Rue Lucien Sampaix,

75010 Paris

Vert Lézard5 Rue Beaurepaire, 75010

Paris

Faubourg Saint Martin82 Rue du Faubourg Saint-

Martin, 75010 Paris

La Fontaine Fleurie3 Rue de la Fontaine au Roi,

75011 Paris

Axel Fleurs30 Avenue Simon Bolivar,

75019 Paris

Example: Florist

Consumer (Application)• Drives Business• Adds a known brandBut:• Homogenizes product• Controls pricing • Keeps %age cut of the

resulting revenue

Creator (APIs)• Empower change – Digital Devices,

Personalization, Delivery, Payments, Ambience etc.

• Create a richer experience

• Capture more value

Paris Taxi Companies

09 70 44 75 75

06 68 35 52 48

01 76 49 76 49

06 07 60 49 14

01 76 21 89 89

Example: Taxis

Consumer (App)• Fantastic User Experience• Good management for

drivers• Drives demand, Lifts the

MarketBut:• Loss of Control• Pricing Influence• Conflict

Creator (APIs)• Differentiated Experiences:

– Local knowledge, personality, vehicles, local knowledge

– Tap into mapping, dispatch, facebook graph, reputation, and more

• Small taxi collectives could hook into the same APIs as Uber

• Collective by collective, or smaller platforms.

Example: Bookshops

GAME OVER for Bookshops?

Example: BookshopsConsumer (Apps): • Large platform competes

with independents• Customer has access to

huge catalogue, shipping, reviews

But: • Cuts out independent book

shops• Homogenizes product• Concentrates Value

Creator (APIs)• Build your OWN

Modern Bookshop:– Lighting– Personalization– Local Authors– Shipping– Online Catalogues

• Individual shops or small collectives

Not saying that Amazon, Uber, et. Are “evil”: Amazing companies

However: broadening who can create1. Spreads economic opportunity

2. Net increases the value being created

WHAT DO WE DO TO MAKE THIS HAPPEN?

Who Me?

Ask the Question

• Who are the beneficiaries of your APIs? – Developers? – Partners?– Customers?– End Users?

• Do these groups Consume or do they Create?

Draw a DiagramO

ppor

tuni

ty to

Cre

ate

Opportunity to Distribute Value Created

Place: Developers, Partners, Customers,

End Users…

AccessData

Connect IFTTT

ControlLighting

ResellAutomation

?

Enable & Empower Users

Docs

Code Samples

SDKs IFTTT

Zapier

Use Case Studies

Excel Plugins

Query builders

Terms of Service

Block-spring

As an industry …

There is Progress…

We should not be having to teaching everybody to become an Engineer

TAKE AWAY’S

1:

APIS are the most powerful tools we have ever had as Software Engineers

2:

Automation will only truly benefit Society if the majority of people can be Creators of Value as well as Consumption

3:

Your company will be 10x* better off if you manage to broaden users and enable more creation

Two Pies

Automation Created by the Few, to serve the many

Automation created by the many, for everyone

Homework for us all: Figure out who your users are and enable them to create value

You will make an enormous difference to the impact of technology

http://www.3scale.net/ @3scale and @njyx on Twitter

REFERENCES

Images• Twilio Billboard, Andy Raskin, San Francisco• https

://500px.com/photo/110775059/hustle-bustle-of-hong-kong-by-nardus-taljard Nardus Taljard

• https://s-media-cache-ak0.pinimg.com/736x/b6/70/64/b67064cd831ecfc6cdf3f2bc44d8753e.jpg

• https://500px.com/photo/92169509/soul-s-artist-by-jacopo-benedetti Jacopo Benedetti

• https://500px.com/photo/99980663/rouge-by-artvideo-studio Art Video Studio

• https://500px.com/photo/215416/-by-taras-perevarukha Tara Perevarukha