I Trust API Providers More When API Pricing Is Front And Center
03 Nov 2014
When you look through as many APIs as I do, you start to get a feeling for many of the subtle signals, that can result in a wealth of information about the actual viability of an API. One signal I'm starting to track on more is pricing, and I'm gathering more details about how an API provider articulates their pricing, or often times doesn’t. The way an API provider discusses their business model can tell you so much about their motivations, the amount of resources they have available, and the experience they have in managing APIs and engaging developers.
Pundits in the space love to talk about the viability of public vs private API, and that public APIs just aren't viable, and will be going away soon. When in reality the public vs. private discussion is not the issue, it is lack of business model, and monetization strategy that is the real tell in all of this. Public APIs like Twilio and Amazon do not have a problem, because they have put a lot of thought into their business models, and their pricing is well thought out, competitive, and front and center in their API developer areas--they aren't in danger because they are public?? DOH!
The companies who will be shuttering their API programs often do not have clear pricing on their site, reducing pricing to be simply a question in the FAQ, and something you have to request more information on. Many companies are trained in sales techniques and are just looking to apply this knowledge in the world of APIs, but I’d say for many of the companies I evaluate, hiding or obfuscating your pricing is not about entrenched sales practices, it is more about exploitation at every turn.
As I go through the 700 API companies in my API Stack, I’m tracking on the details of their business model, and will be judging APIs on how they showcase their pricing (or don't). I don't care if companies are still working to figure it out, or have top tiers that are “enterprise pricing”, and “request more details”. What I do care about is how communicative you are about your pricing, and enforcing that the pricing for API resources is one of the most important signals you can send as part of your API management strategy.
Remember, when you use Twitter as and example of how public APIs aren’t viable, you are actually referencing the lack of a coherent business model that fully includes the developer ecosystem, and has nothing to do with the viability of public APIs. Public APIs are here to stay, but the smoke and mirrors of “enterprise pricing” will have to evolve if you expect to play in this new game, and actually get the attention of developers.
P.S. The magic wand is my new icon for "enterprise pricing", because I see the term being used as a magic wand for making up pricing, more than I see it used as viable sales cycles. I searched for images of pulling pricing out of your ass, but it didn't result in family friendly images I can show here, so I'm using a magic wand.