Sam Ramji - Darwin’s Finches, 20th Century Business, and API's

8/2/2019 Sam Ramji - Darwins Finches, 20th Century Business, and API's

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Darwins Finches,20th Century Business,

and APIs

Evolve Your Business Model

Sam Ramji @sramjiVP Strategy, Apigee


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DARWINS FINCHES


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These birds


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live in this paradise right here


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so whats the problem?


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The problem is


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theyre on a small island chain


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a long way from anywhere else


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thats a lot ofenvironmental pressure


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so these finches


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are actually terrific competitors


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and their differences


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were defined by this man


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as successful adaptations.


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The ones you dont see today


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had unsuccessful adaptations


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and died out.


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A century after


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a team of scientists identified the mechanism

ofadaptation and evolution


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Twenty years later


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called out the gene

as the atomic unit ofcompetition.


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From the perspective of the gene


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the gene is successful

if the organism that carries it is successful.


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Switching gears


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20th CENTURY

BUSINESS


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In 1910 business was mostly direct


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By the 1930s there was a lot ofcompetition


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But after World War II, there were new

environmental pressures


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Many businesses died out.


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Business went from direct to indirect.


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Those businesses who thrived in this transition


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Shared a set ofsuccessful adaptations


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Special makes for select retailers

Broad consumer marketing and branding

Distribution exclusives in territory and product allocation

Retailer incentives slotting fees, joint marketing, tiered

volume discounts

Consumer incentives coupons, in-store events, limitedtime discounts


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Unified by one idea


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It was not just about selling in


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It was not just about selling in

It was about selling through.


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From the perspective of the business


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The business is successful

If the retailer that it sells through is successful.


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The real world went from direct to indirect


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It went beyond the corner store.


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The web world is going from direct to indirect.


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It is going beyond the browser.


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That takes us to


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APIs


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Robert ScobleAuthor of tech blog Scobleizer


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Why?


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Because in a web beyond the browser


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APIs are how people get to your business.


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You need to see things

from the perspective of the gene.


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The gene is successful

if the organism that carries it is successful.


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You need to see your business

from the perspective of the API.


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The API is successful if

the application that carries it is successful.


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Successful applications will use many

different APIs.


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and they will carry those APIs everywhere


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z


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taking your business with them.


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For the successful companies, 80% of traffic will

be coming from beyond the browser.


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Everyone else will have to play in the world

that the winners make.


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One last thought on evolution


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Adaptive Radiation in Twitter Applications


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Classifications byOneforty.com

Visualization bySonoa


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CURRENT

ENVIRONMENTAL

PRESSURES

bil


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Mobile

Social Cloud


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They can be independent or they can support

each other.

It is up to you to decide if theres harmony.


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Y b ll d t d t


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Your company may be very well adapted to

the web, but is it adapted to mobile?

Mobile devices have limited storage and

processing and need to be tied in to real-

world and social dimensions.

They use APIs to get at location, maps,

social graphs, and events.


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Social sites are data services with a critical mass

of users, where each new user makes the

service better.

You cant build a new Facebook or Twitter.

But you need to access them, so you use their

APIs.


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Cloud computing is not about Amazon.


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Cloud computing is not about Rackspace.


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Cloud computing is not about Microsoft.


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Cloud computing is not about Google.


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Cloud computing is about

how you reach your customers


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Weve gone from libraries to APIs


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We ve gone from libraries to APIs.

In a cloud computing world people access

library-like functionality via an API.

These services are the unit of programming.

Make your API useful and it will be carried to

customers youve never met.


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CHANGE AGENCY


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I know you get all this already

But how do you get your colleagues to join

you in the journey to APIs?


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Whats so damn wrong with the current model?

I like it and its working for me.

Plus, I understand it.


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Actually, its not working.


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Populations, societies, and markets are becoming

more specialized and differentiated.


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Consumer interest groups are fragmented.


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Consumer interest groups are increasingly fragmented.


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Markets are changing so fast that you cant

spend the time to


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market size,

focus group,plan,

develop,

launch,measure and

sustain

because the market niche may be gone or

fundamentally changed


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A rapidly expanding range of computing

platforms are needed to reach consumers.


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Mary Meeker, Morgan Stanley


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This is not a solvable problem nor a winnable game.


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The only way to win is to change the game.


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Thousands of people,

who are not on your payroll,


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who are noton your payroll,

who are intimately part of each of these changing

interest groups and niches,

must be convinced to carry

your productthere for you

in a way that adapts to the dynamic

environment




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y p y ,




your brandthere for you


environment




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y p y ,




your experience there for you


environment


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Its a competition for ideas


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Enable your business to adapt into niches


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Only 1 of 100 will be successful not a


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failure rate that you can withstand and

remain in business.

You need to encourage that to happen

out there where the cost structures andspeed of business are synchronized.

Be ready to reward or acquire the winners.


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SUCCESSFUL

API ADAPTATIONS

Realizing that developers are your channel


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Being recombinant and easily mixed

Unlocking your legacy data into open APIs

Driving new data into your system via open APIs

Supporting your application ecosystem

developers


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Why do you need to attract developers?

developers


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Because applications are the fastestgrowing and fastest changing organisms in

this environment

and theyre built by developers

developers


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Unsuccessful adaptations to this world are based

on the following conventional wisdom

developers


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Companies providing APIs to access their business

are the supply

Developers who build against those APIs

are the demand

developers


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This is exactly wrong.

developers


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Companies providing APIs are the demand

developers


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Companies providing APIs are the demand

They demand developers attention and adoption

developers


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Developers building with APIs are the supply

developers


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Developers building with APIs are the supply

They supply innovation and adaptation


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developers


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Developers now sit between you and your customers

They are like the retail store in the value chain

Packaged Goods


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ConsumerRetail StoreProducer

Internet Services

ConsumerDeveloperProvider App


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SUCCESSFUL

API ADAPTATIONS

Two rules for marketing your API to developers

recombinant


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Two rules for marketing your API to developers

1. Dont assume that developers are clamoring for your API.

2. Dont assume that developers will want to use your API alone.


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recombinant


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Be robust so that your API is recombinant

Thi i ll b h


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Michael HartDirector of Engineering, Netflix

This is all about the customers.

We allow developers to integrate the Netflix service into apps

with full control over the user experience.

So we are able to outsource innovation and thats a greatthing.


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Visualization byApigee

recombinant


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Rules for robustness

REST first, everything else second

Nothing weird: straight XML straight JSON

recombinant


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Nothing weird: straight XML, straight JSON

Keep responses small

Keep calls granular

No custom security schemes: use OAuth

Dont make the developer deal with PCI-compliance

Sample code wins every timeYoull get it wrong the first time so listen well


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recombinant


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Be remixable so that your API is recombinant


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recombinant


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Rules for miscibility

Observe your adjacencies

recombinant


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Dont break social sign-on

Dont require session management

Provide sample code for expected remixesReward creativity through promotion


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SUCCESSFUL

API ADAPTATIONS

legacy data


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Unlocking your legacy data into open APIs

legacy data


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Open APIs for your legacy data means innovation

can happen out there

Product Catalogs that integrate with your backend

Customer Preferences based on your interactions

legacy data


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f y

Historical Purchases through your existing sites

Logistics Information about your supply chain

Seasonalityon purchases of goods and services

Location of historical purchases

User Recommendations of good and servicesService Providers that you have transacted with


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SUCCESSFUL

API ADAPTATIONS

new data


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Driving new data into your system via open APIs

Data is the new business model

new data


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Data is the new business model

Each new user makes the service better

Use the tail to feed the head

GameSpy Open

new data


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One single API for the head and the tailTail policy: limited access for free

Head policy: unlimited access for fee


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Data from Programmable Web


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Data from Wikipedia


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SUCCESSFUL

API ADAPTATIONS


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Helping your finches succeed


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Help your application ecosystem succeed

An app is only as strong as its weakest API call

application ecosystem


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Your API is a product like any other product

Design for scale of business processes

There is a huge gap between a feature and a

business


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John MusserFounder, Programmable Web


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Programmable Web

application ecosystem


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It is not just about selling in

It is about selling through.


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InCLOSING


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John MusserFounder, Programmable Web


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Dion HinchcliffeDachis Group


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THANK YOU


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Questions and ideas to:

@sramji

[email protected]

Biography

As you have already figured out, the name of the blog is in honor of Richard Feynman, my

personal hero. Physics has the same basic means of inquiry that we need to use in business

and has rich metaphors for thinking about markets. New markets are baby universes - they

are born, expand, merge, and collapse. Exploring the physics of these phenomena means

asking dumb questions and being prepared to be surprised by the answers - and applying this

to the multiverse of software startups and open source technology is what this blog is all

about.

I've been in five startups (NetStudio, Brightware, WebHarbor, Xoriant, and Ofoto) and four

established companies (Broderbund, Fair Isaac, BEA Systems, and Microsoft). I now work for

Apigee as VP of Strategy.

Before joining Apigee in September 2009, I worked at Microsoft from 2004-2009 where I led

worldwide Open Source and Linux Strategy I worked at BEA Systems before that from

Sam Ramji http://samus.typepad.com/about.html


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worldwide Open Source and Linux Strategy. I worked at BEA Systems before that from

2002-2004 in the WebLogic Integration product unit as Director of Market Development,

focused on technical market strategy under Chet Kapoor and Dave Hinman. Our team grew

revenue for WLI from $20M to $100M in 2 years, and from a Gartner Magic Quadrant "Niche

Player" to "Leader". Prior to that I was Director of Engineering at Ofoto before, during, and

briefly after the Kodak acquisition.

I had the extraordinary opportunity to stand on the shoulders of giants at UCSD, where I got

my BS in Cognitive Science (AI meets Neurobiology) - Pat Churchland, Don Norman, Edwin

Hutchins, and other greats taught there... a truly amazing experience that has shaped much ofhow I think today.

In real life I'm an avid husband, father of two, mountain biker, guitarist and food-eater - I

appreciate everything from the humble burger to sea-urchin sushi. I live with my wife and

children in my favorite place on earth, Marin County, California.

Interests

guitar, history, cognitive science, philosophy, mountain biking, eating, physics, tennis, coaching

kids' sports

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Sam Ramji - Darwin’s Finches, 20th Century Business, and API's

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