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Darwin’s Finches,20th Century Business,and APIs,[object Object],Evolve Your Business Model,[object Object],Sam Ramji				@sramji,[object Object],VP Strategy, Apigee,[object Object]
DARWIN’S FINCHES,[object Object]
These birds,[object Object]
Darwin's Finches, 20th Century Business, and APIs
live in this paradise right here,[object Object]
Darwin's Finches, 20th Century Business, and APIs
so what’s the problem?,[object Object]
The problem is,[object Object]
they’re on a small island chain,[object Object]
Darwin's Finches, 20th Century Business, and APIs
a long way from anywhere else,[object Object]
Darwin's Finches, 20th Century Business, and APIs
that’s a lot of environmental pressure,[object Object]
so these finches,[object Object]
Darwin's Finches, 20th Century Business, and APIs
are actually terrific competitors,[object Object]
and their differences,[object Object]
Darwin's Finches, 20th Century Business, and APIs
were defined by this man,[object Object]
Darwin's Finches, 20th Century Business, and APIs
as successful adaptations.,[object Object]
The ones you don’t see today,[object Object]
had unsuccessful adaptations,[object Object]
and died out.,[object Object]
A century after,[object Object]
Darwin's Finches, 20th Century Business, and APIs
a team of scientists identified the mechanism of adaptation and evolution,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Twenty years later,[object Object]
Darwin's Finches, 20th Century Business, and APIs
called out the gene,[object Object],as the atomic unit of competition.,[object Object]
From the perspective of the gene,[object Object]
the gene is successful ,[object Object],if the organism that carries it is successful.,[object Object]
Switching gears,[object Object]
20th CENTURY ,[object Object],BUSINESS,[object Object]
In 1910 business was mostly direct,[object Object]
Darwin's Finches, 20th Century Business, and APIs
By the 1930s there was a lot of competition,[object Object]
Darwin's Finches, 20th Century Business, and APIs
But after World War II, there were new environmental pressures,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Many businesses died out.,[object Object]
Business went from direct to indirect.,[object Object]
Those businesses who thrived in this transition,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Shared a set of successful adaptations,[object Object]
Broad consumer marketing and branding,[object Object],Distribution exclusives in territory and product allocation,[object Object],Special makes for select retailers,[object Object],Retailer incentives – slotting fees, joint marketing, tiered volume discounts,[object Object],Consumer incentives – coupons, in-store events, limited time discounts,[object Object]
Unified by one idea,[object Object]
It was not just about selling in,[object Object]
It was not just about selling in,[object Object],It was about selling through.,[object Object]
From the perspective of the business,[object Object]
The business is successful,[object Object],If the retailer that it sells through is successful.,[object Object]
The real world went from direct to indirect,[object Object]
It went beyond the corner store.,[object Object]
The web world is going from direct to indirect.,[object Object]
It is going beyond the browser.,[object Object]
That takes us to,[object Object]
APIs,[object Object]
“,[object Object],Robert Scoble,[object Object],Author of tech blog Scobleizer,[object Object]
Why?,[object Object]
Because in a web beyond the browser ,[object Object]
APIs are how people get to your business.,[object Object]
You need to see things ,[object Object],from the perspective of the gene.,[object Object]
The gene is successful ,[object Object],if the organism that carries it is successful.,[object Object]
You need to see your business ,[object Object],from the perspective of the API.,[object Object]
The API is successful if ,[object Object],the application that carries it is successful.,[object Object]
Successful applications will use many different APIs.,[object Object]
Darwin's Finches, 20th Century Business, and APIs
and they will carry those APIs everywhere,[object Object]
z,[object Object]
taking your business with them.,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
For the successful companies, 80% of traffic will be coming from beyond the browser. ,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Everyone else will have to play in the world that the winners make.,[object Object]
One last thought on evolution,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Adaptive Radiation in Twitter Applications,[object Object],Visualization by Sonoa,[object Object],Classifications by Oneforty.com,[object Object]
CURRENTENVIRONMENTAL PRESSURES,[object Object]
Mobile,[object Object],Social,[object Object],Cloud,[object Object]
They can be independent or they can support each other.,[object Object],It is up to you to decide if there’s harmony.,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Your company may be very well adapted to the web, but is it adapted to mobile?,[object Object],Mobile devices have limited storage and processing and need to be tied in to real-world and social dimensions.,[object Object],They use APIs to get at location, maps, social graphs, and events.,[object Object]
Social sites are data services with a critical mass of users, where each new user makes the service better.,[object Object],You can’t build a new Facebook or Twitter.,[object Object],But you need to access them, so you use their APIs.,[object Object]
Cloud computing is not about Amazon.,[object Object]
Cloud computing is not about Rackspace.,[object Object]
Cloud computing is not about Microsoft.,[object Object]
Cloud computing is not about Google.,[object Object]
Cloud computing is about,[object Object],how you reach your customers,[object Object]
Darwin's Finches, 20th Century Business, and APIs
We’ve gone from libraries to APIs.,[object Object],In a cloud computing world people access library-like functionality via an API.,[object Object],These services are the unit of programming.,[object Object],Make your API useful and it will be carried to customers you’ve never met.,[object Object]
CHANGE AGENCY,[object Object]
I know you get all this already,[object Object],But how do you get your colleagues to join you in the journey to APIs?,[object Object]
What’s so damn wrong with the current model?,[object Object],I like it and it’s working for me.,[object Object],Plus, I understand it.,[object Object]
Actually, it’s not working.,[object Object]
Populations, societies, and markets are becoming more specialized and differentiated. ,[object Object]
Consumer interest groups are fragmented.,[object Object]
Consumer interest groups are increasingly fragmented.,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Markets are changing so fast that you can’t spend the time to 	“market size, ,[object Object],	  focus group, ,[object Object],	  plan, ,[object Object],	  develop, ,[object Object],	  launch, ,[object Object],  measure and ,[object Object],  sustain” ,[object Object],because the market niche may be gone or fundamentally changed,[object Object]
A rapidly expanding range of computing platforms are needed to reach consumers.,[object Object]
Mary Meeker, Morgan Stanley,[object Object]
This is not a solvable problem nor a winnable game.,[object Object]
The only way to win is to change the game.,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Thousands of people, ,[object Object],who are not on your payroll, ,[object Object],who are intimately part of each of these changing interest groups and niches, ,[object Object],must be convinced to carry ,[object Object],your product there for you ,[object Object],in a way that adapts to the dynamic environment,[object Object]
Thousands of people, ,[object Object],who are not on your payroll, ,[object Object],who are intimately part of each of these changing interest groups and niches, ,[object Object],must be convinced to carry ,[object Object],your brand there for you ,[object Object],in a way that adapts to the dynamic environment,[object Object]
Thousands of people, ,[object Object],who are not on your payroll, ,[object Object],who are intimately part of each of these changing interest groups and niches, ,[object Object],must be convinced to carry ,[object Object],your experience there for you ,[object Object],in a way that adapts to the dynamic environment,[object Object]
It’s a competition for ideas,[object Object]
Enable your business to adapt into niches,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Only 1 of 100 will be successful – not a failure rate that you can withstand and remain in business.  ,[object Object],You need to encourage that to happen “out there” where the cost structures and speed of business are synchronized.  ,[object Object],Be ready to reward or acquire the winners.,[object Object]
SUCCESSFULAPI ADAPTATIONS,[object Object]
Realizing that developers are your channel,[object Object],Being recombinant and easily mixed,[object Object],Unlocking your legacy data into open APIs,[object Object],Driving new data into your system via open APIs,[object Object],Supporting your application ecosystem,[object Object]
developers,[object Object],Why do you need to attract developers?,[object Object]
developers,[object Object],Because applications are the fastest growing and fastest changing organisms in this environment,[object Object],and they’re built by developers,[object Object]
developers,[object Object],Unsuccessful adaptations to this world are based on the following conventional wisdom,[object Object]
developers,[object Object],Companies providing APIs to access their business are the supply,[object Object],Developers who build against those APIs are the demand,[object Object]
developers,[object Object],This is exactly wrong.,[object Object]
developers,[object Object],Companies providing APIs are the demand,[object Object]
developers,[object Object],Companies providing APIs are the demand,[object Object],They demand developers’ attention and adoption,[object Object]
developers,[object Object],Developers building with APIs are the supply,[object Object]
developers,[object Object],Developers building with APIs are the supply,[object Object],They supply innovation and adaptation,[object Object]
Darwin's Finches, 20th Century Business, and APIs
developers,[object Object],Developers now sit between you and your customers,[object Object],They are like the retail store in the value chain,[object Object]
Packaged Goods,[object Object],Consumer,[object Object],Retail Store,[object Object],Producer,[object Object],Internet Services,[object Object],App,[object Object],Developer,[object Object],Consumer,[object Object],Provider,[object Object]
SUCCESSFULAPI ADAPTATIONS,[object Object]
recombinant,[object Object],Two rules for marketing your API to developers,[object Object],1. Don’t assume that developers are clamoring for your API.,[object Object],2. Don’t assume that developers will want to use your API alone.,[object Object]
Darwin's Finches, 20th Century Business, and APIs
recombinant,[object Object],Be robust so that your API is recombinant,[object Object]
“,[object Object],This is all about the customers.,[object Object],We allow developers to integrate the Netflix service into apps with full control over the user experience.,[object Object],So we are able to outsource innovation … and that’s a great thing.,[object Object],Michael Hart,[object Object],Director of Engineering, Netflix,[object Object]
Visualization by Apigee,[object Object]
recombinant,[object Object],Rules for robustness,[object Object]
recombinant,[object Object],REST first, everything else second,[object Object],Nothing weird: straight XML, straight JSON,[object Object],Keep responses small,[object Object],Keep calls granular,[object Object],No custom security schemes: use OAuth,[object Object],Don’t make the developer deal with PCI-compliance,[object Object],Sample code wins every time,[object Object],You’ll get it wrong the first time – so listen well,[object Object]
Darwin's Finches, 20th Century Business, and APIs
recombinant,[object Object],Be remixable so that your API is recombinant,[object Object]
Darwin's Finches, 20th Century Business, and APIs
recombinant,[object Object],Rules for miscibility,[object Object]
recombinant,[object Object],Observe your adjacencies,[object Object],Don’t break social sign-on,[object Object],Don’t require session management,[object Object],Provide sample code for expected remixes,[object Object],Reward creativity through promotion,[object Object]
SUCCESSFULAPI ADAPTATIONS,[object Object]
legacy data,[object Object],Unlocking your legacy data into open APIs,[object Object]
legacy data,[object Object],Open APIs for your legacy data means innovation can happen out there,[object Object]
legacy data,[object Object],Product Catalogs that integrate with your backend,[object Object],Customer Preferences based on your interactions,[object Object],Historical Purchases through your existing sites,[object Object],Logistics Information about your supply chain,[object Object],Seasonality on purchases of goods and services,[object Object],Location of historical purchases,[object Object],User Recommendations of good and services,[object Object],Service Providers that you have transacted with,[object Object]
“,[object Object]
SUCCESSFULAPI ADAPTATIONS,[object Object]
new data,[object Object],Driving new data into your system via open APIs,[object Object]
new data,[object Object],Data is the new business model,[object Object],Each new user makes the service better,[object Object],Use the tail to feed the head,[object Object]
new data,[object Object],GameSpy Open,[object Object],One single API for the head and the tail,[object Object],Tail policy:  limited access for free,[object Object],Head policy: unlimited access for fee,[object Object]
Darwin's Finches, 20th Century Business, and APIs
Darwin's Finches, 20th Century Business, and APIs
Data from Programmable Web,[object Object]
Data from Wikipedia,[object Object]
SUCCESSFULAPI ADAPTATIONS,[object Object]
Helping your finches succeed,[object Object]
Help your application ecosystem succeed,[object Object]
application ecosystem ,[object Object],An app is only as strongas its weakest API call,[object Object],Your API is a product like any other product,[object Object],Design for scale of business processes,[object Object],There is a huge gap between a feature and a 	business,[object Object]
“,[object Object],John Musser,[object Object],Founder, Programmable Web,[object Object]
Programmable Web,[object Object]
application ecosystem ,[object Object],It is not just about selling in,[object Object],It is about selling through.,[object Object]
“,[object Object],Fred Wilson,[object Object],Union Square Ventures,[object Object]
InCLOSING,[object Object]
John Musser,[object Object],Founder, Programmable Web,[object Object]
Dion Hinchcliffe,[object Object],Dachis Group,[object Object]
Darwin's Finches, 20th Century Business, and APIs
THANK YOU,[object Object],Questions and ideas to:,[object Object],@sramji,[object Object],sramji@apigee.com,[object Object]

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Editor's Notes

  1. Creative Commons Attribution-Share Alike 3.0 United States License
  2. http://www.csuchico.edu/~curban/DarwinSP2002Phil108.htmUse at beginning to set up story – 1,2,3 are the same genus – adaptation to a competitive environment (island)
  3. http://newdesktopwallpapers.info/The%20best%20of%20summer%20-%20Islands%20and%20Tropical%20Paradise/Islands/slides/Coastal%20View,%20Galapagos%20Islands.html
  4. http://visibleearth.nasa.gov/view_rec.php?id=5517
  5. http://maps.google.com/maps?ftr=earth.promo&hl=en&utm_campaign=en&utm_medium=mapshpp&utm_source=en-mapshpp-na-us-gns-erth&utm_term=evl
  6. http://www.csuchico.edu/~curban/DarwinSP2002Phil108.htm
  7. http://www.csuchico.edu/~curban/DarwinSP2002Phil108.htm
  8. http://www.reproductive-revolution.com/charles-darwin.html
  9. http://www.reproductive-revolution.com/charles-darwin.html
  10. Avery, MacLeod, and McCarty
  11. http://bbruner.org/bitn/bitn_fig/dna.gif - http://www.genome.gov/glossary/index.cfm?
  12. Avery, MacLeod, and McCarty
  13. Avery, MacLeod, and McCarty
  14. http://ephemeralnewyork.wordpress.com/tag/old-signs/
  15. http://wirednewyork.com/forum/showthread.php?p=299745
  16. http://s.wsj.net/public/resources/images/PT-AK559_Suburb_G_20081224174421.jpg
  17. http://www.laapush.org/environmentalspectrum_files/images/000001ad.jpg
  18. http://media.photobucket.com/image/new%20york%201950/guaporense/midtown1955.jpg
  19. http://s.wsj.net/public/resources/images/PT-AK559_Suburb_G_20081224174421.jpg
  20. http://www.springfieldrewind.com/photos/sears70a.jpg
  21. http://farm5.static.flickr.com/4072/4338895970_56d7989798_o.jpg
  22. http://bbruner.org/bitn/bitn_fig/dna_repl.gif - http://www.genome.gov/glossary/index.cfm?
  23. OpenTable, MovieTickets, TaxiMagic, Citysearch, Yelp, Yahoo Local, Gayot, Rotten Tomatoes, NYTimes.com, WeatherBug, AllMenus, StubHub, LiveKick, Maponics, Nuance and TrueKnowledge - http://blogs.zdnet.com/semantic-web/?p=333&tag=col1;post-333
  24. NPR, New York Times, MTV Networks, Finance, Healthcare, Manufacturing; “Some of these businesses have been around for 5 years, others for 100”
  25. http://www.britannica.com/EBchecked/topic-art/197367/74641/Fourteen-species-of-Galapagos-finches-that-evolved-from-a-common
  26. http://en.wikipedia.org/wiki/Punctuated_equilibriumWe are in an epoch of change – no longer copying Amazon’s 1-click model – rapid speciation
  27. Cloud computing doesn’t have to mean moving your datacenter to AmazonIt can be about enabling cloud consumers to access your business via your API so that your business is everywhere – mobile and social, and underneath a thousand apps.
  28. http://www.britannica.com/EBchecked/topic-art/197367/74641/Fourteen-species-of-Galapagos-finches-that-evolved-from-a-common
  29. http://www.britannica.com/EBchecked/topic-art/197367/74641/Fourteen-species-of-Galapagos-finches-that-evolved-from-a-common
  30. Respect the patterns – use REST, make it human-readable if possiblegraph.facebook.com is a great example of a clean REST API
  31. http://www.insidefurniture.com/.shared/image.html?/photos/uncategorized/predictions_crystal_ball.jpg
  32. http://www.mun.ca/biology/desmid/brian/BIOL2060/BIOL2060-20/2027.jpg
  33. Don’t break the developer’s ability to do a “sign in with Twitter” or “Facebook Connect” authentication schemeClone similar APIs as appropriate (Tumblr)
  34. GameSpy OpenOpen APIs for data and development services, making it easier for its partners on all platforms to add compelling online features to games, measure game performance and audience engagement, and collaborate with their communities.  1. one api for head and tail 2.  for the tail - different policies - :  give limited/metered access to long tail, self-service, provisioniong 3 using the tail to drive data! 
  35. Helping your (finches) application ecosystem succeed
  36. Helping your (finches) application ecosystem succeed
  37. Don’t have a meltdown!
  38. Get everyone on the same page – you need business metrics, a picture of what success looks like, and executive buy-in and report-outs
  39. http://www.avc.com/a_vc/2009/10/business-model-jujutsu.html
  40. “But it’s not enough to just have one. Everyone has or will have one, just like everyone had a website. So this is the new competitive landscape. And developers are your new indirect channel. You need to address, motivate, and sustain your indirect channel. The companies that thrive in THIS transition will write the rules for everyone else.”
  41. NPR, New York Times, MTV Networks, Finance, Healthcare, Manufacturing; “Some of these businesses have been around for 5 years, others for 100”
  42. http://www.britannica.com/EBchecked/topic-art/197367/74641/Fourteen-species-of-Galapagos-finches-that-evolved-from-a-common