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The Top 5 API Trends for 2023

By Frank Kilcommins, API Technical Evangelist at SmartBear

The digital world has brought a paradigm shift in how value is exchanged. Today, every company is effectively a software company, and its APIs that enable organizations around the world work to meet customer needs and incorporate emerging innovations. The need to participate in the digital economy is an industry agnostic requirement.

Given the challenging economic outlook, what are the top API trends coming in the next year?

1.     Composable Enterprise

Organizations are striving to build seamless digital experiences in a predictable and rapid cadence. Composability, as a core business strategy, is gaining popularity. Customer-centered and market-aware adaptability allows organizations to pivot when required. The approach ensures a common understanding across an organization of how business value is positioned, composed, and ultimately offered.

The rise of microservices and better awareness as to the barriers that data silos and monolith heritage applications bring to creating robust digital experiences have additionally contributed to bottom-up momentum aimed at improved architectural composability.

Analysts such as Gartner predict that by the end of 2023, 60% of organizations will identify becoming a composable enterprise as a strategic objective. The need to create packaged business capabilities to achieve such strategies will only increase the importance of APIs.

Ultimately, a composable architecture enables a company the ability to discover all their API capabilities, promote their reuse in a modular way, choreograph or orchestrate them into new applications (or API products), and execute toward measurable business outcomes. The additional organizational agility that can be achieved will be especially welcome given the unpredictable economic climate.

2.     Embedded Finance

Financial services are benefiting from embracing the growth of the API ecosystem to deliver innovation and excellent customer experiences. The move toward openness, consistent data sharing, and regulation around consent is a global trend driving the concept of embedded finance.

Embedded finance is the operating system that enables developers to incorporate financial capabilities like payments, banking, insurance, or investment functionality rapidly into their solutions with the potential of unlocking new revenue streams. Participating in embedded finance today is non-negotiable and the means to accessible transactions that otherwise will remain out of reach for traditional proprietary solutions.

A combination of regulatory and market-driven approaches has led to a more competitive landscape and rightfully for the benefit of consumers. The race is truly on for financial organizations to expose digital representations of their capabilities (e.g., via APIs) ready to be embedded in customer eco-systems to deliver and enable new experiences.

3.     Multifaceted Integration Landscapes

There is no one-size-fits-all approach to delivering APIs. A mix of integration patterns and API styles provides a multifaceted integration landscape. The benefit is that organizations can focus on solving problems in the right way with the best possible technology solution and the most suitable consumer experience. The "bike shedding" regarding which is the best API style and perceived competition between different API patterns will be replaced by the knowledge that having a mix of API styles makes perfect sense.

Although the REST architectural style still dominates, we have seen GraphQL and Event-Driven (AsyncAPI) double in popularity. The trend should continue with more API styles being used, driving a multifaceted integration landscape across all industry verticals.

Figure 1 - According to the SmartBear State of Quality API report, 81% of respondents use more than one protocol, while 57% use 3 or more API styles.

4.     API Visibility

Enterprises are producing and consuming an exponentially growing number of APIs. The resulting API sprawl is a term that has some negative connotations, and with good reason, as it's normally associated with little concern for planning. API gateway tooling has traditionally helped bring better discoverability to the enterprise API landscape. Runtime gateways are becoming a commodity offering, and analysts such as Gartner predict by 2025 that less than 50% of enterprise APIs will be managed as explosive growth in APIs surpasses the capabilities of API management tools.

Expect focused innovation in API visibility to provide full insight into the API lifecycle for provider and consumer teams. API proliferation is exactly what we want to see, but we need to equip teams with the ability to understand their API portfolio and highlight in-flight changes to ensure appropriate planning, structure, security, and governance.

Given recent layoffs across the tech sector, teams are being stretched to deliver more with less. You cannot do more with less, but better API and developer visibility can enable teams to focus on high impact work. If you do not have the visibility on your APIs, how can you:

• Discover your APIs and promote their reuse
• Ensure your APIs are secure
• Validate your APIs meet developer experience needs
• Confirm APIs align with your API standards
• Evolve your APIs without breaking consumer expectations
• Ensure expected benefits can be realized
  

5.     Standardization: Enablement rather than Impediment

According to the SmartBear State of Quality API report, standardization is the top API challenge that teams and practitioners want to see solved within the API landscape. Given the multi-industry move toward openness, consistent data sharing, participation in shared marketplaces and eco-systems as a global trend, it is not a surprise that standardization plays a crucial role in achieving secure and compliant interoperability.

Organizations are now realizing that appropriate levels of standardization and governance can enable the delivery of higher quality APIs consistently faster while remaining nimble to market changes. Adopting well-proven API specifications consistently for their API products improves the consuming developer experience (DX). Standardization also promotes cross-functional participation in API delivery (remember - APIs are not just for IT) to validate that an API being delivered addresses a given problem in a manner that aligns with company standards.

Treating standardization as an enabler allows enterprises to apply the appropriate guiderails for maximum developer experience for the benefit of consumers. Simultaneously, the teams producing APIs can achieve sufficient optionality.

Achieving a consistent experience across APIs toward consumers is fast becoming critical for organizations to gain trust with their consumers. Additionally, the consistency makes it easier to achieve success with internal innovations in low-code, no-code, and AI related initiatives.

APIs will weather the storm

The economic climate might be uncertain, but investment in API technology and API-fueled value exchanges will continue to increase. We have passed a precipice in terms of digital experiences and APIs are the ubiquitous within them making participation possible.

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ABOUT THE AUTHOR

Frank Kilcommins is API Technical Evangelist at SmartBear. He has over 15 years of experience in the technology industry, his roles spanning from software engineering to enterprise architecture. His mission is to inspire, engage with, and support the API community as well as SmartBear customers across the end-to-end API development lifecycle and management space. Prior to joining SmartBear, Frank's most recent roles have been focused on API-led digital transformations and architecture modernization within multi-national enterprises.