Indirect API models cover all of the other ways for firms to benefit from APIs. is the perfect example of this, where the developer is paid a commission for every sale they generate using the API. This usually comes as part of a revenue-share or affiliate program where a developer using the API can get paid for every lead they send to the website through the API. The developer that gets paid is another API business model, where the company pays a certain amount to the developer for using its API. PayPal charges a transaction fee for every single payment made via its API. PayPal is an example of this type of API where the user must pay for accessing its payments. In this type of API business model, the data provided through the API is valuable and as such, developer must pay to access it. Another model is called the ‘developer pays’. The reason is that having developers use their API allows them to increase the reach of their firm or allows the firm to reach more users.
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In a free API, an organization or a company gives access to its API without any cost.
API business models allow firms to further their business objectives through their APIs. The contract usually represents some agreed-upon standards on exactly how the information or functionality – like drawing a map – is going to be exchanged.Ĭompanies often use APIs for making money. APIs are no different – there is a contract that exists between the consumer of the API and the provider of the API in the way that performance of both is required. The player must deliver certain performance on the field, while the team must pay the player a certain amount of money for that performance. For example, when a footballer signs a contract with a team, both parties are bound to certain performance by that contract. This is imperative, because if that understanding isn’t exact, then the actual API transaction will break down.
An exact understanding must be there between the application that is consuming the API and the API provider. In order for this to happen, there must exist a technical contract between the two parties. This is a good example of how you might outsource some kind of functionality to your application.
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For instance, instead of writing the code you would need to paint a map in your application, you can outsource that with one line of code to the Google Maps API.
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