An API-Only Business Model?

Amazon, Yahoo, and Ebay all have E-Commerce APIs, right? The model is “You can create a UI and if it fits a niche better than us, you make money”. It’s one of those odd models where you’re competing and partnering at the same time. Some other examples where this hsa occurred:

  • Phone companies forced by government regulations to open up to third-party DSL providers.
  • Microsoft providing APIs for competitors to use.

Hmmm. These previous examples have not been without controversy. Ultimately, a company under this model can make a bit of money, but things get antagonistic once they start to be serious competition. Does this logic apply with Amazon, Yahoo, and Ebay? I haven’t heard too much about it, but one thing’s for sure: whatever you can build with their API, they can build too, and they have the data and background knowledge to go much further.

So as pure speculation, what would happen if a startup offered a pure API-only E-Commerce platform? No web interface, their entire revenue derived from third-party clients. Maybe there already is such a thing, I don’t know. The only way they make money is if the third-party clients are making money.

This came up because I’ve been thinking about the Ajax-WebServices/SOA tie-in. It seems that many people are talking about creating generic web APIs and handling the entire UI in Javascript. (I’m ignoring whether the API is REST or RPC or whatever for now – that’s a side issue.) That being the case, the browser-based Ajaxian UI becomes nothing more than one of infinite possible clients for the web API.

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