In 2016, Financial Services Executives Will Bet Big On APIs

Peter Wannemacher

We’ve just published our Predictions 2016 report, outlining eight shifts that banks and their partners can expect by December 31 of next year. I encourage you to read the full report with all of our predictions here.

As a preview of the report, here are two of our predictions for 2016:

  • APIs and open platforms will take center stage. APIs are becoming the most powerful technology in digital business design. Done right, APIs open new angles for business strategy. Financial services providers have been relatively slow to recognize and act on APIs as an opportunity to transform their businesses and, ultimately, better win, serve, and retain customers.* This will change in 2016, as digital executives collaborate with CIOs to champion big investments in internal, B2B, and product APIs. APIs won’t only help firms increase agility and provide services to clients and partners: They will enable financial firms to build dynamic ecosystems of value, reconnecting a fragmented value chain. They will be part of a wider, and longer-term, shift to open platforms as the foundation of digital financial services strategy.
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Modern Software Platforms Are In Hypergrowth

Michael Yamnitsky

As companies get serious about digital transformation, we see investments shifting toward extensible software platforms used to build and manage a differentiated customer experience. My colleague John McCarthy has an excellent slide describing what's happening:

Before, tech management spent most of its time and budget managing a set of monolithic enterprise applications and databases. With an addressable market of a finite number of networked PCs, spending on the front end was largely an afterthought.

Today, applications must scale to millions, if not billions of connected devices while retaining a rich and seamless user experience. Infrastructure, in turn, must flex to meet these new specs. Since complete overhauls of the back end are a nonstarter for large enterprises with 30-plus years of investments in mainframes and legacy server systems, new investments gear toward the intermediary software platforms that connect digital touchpoints with enterprise applications and transaction systems. 

At Forrester, we’ve been working to quantify some of the most viable software categories that exemplify this shift. A shortlist below:

·      API management solutions: US CAGR 2015-2020: 22%.

·      Public cloud platformsGlobal CAGR 2015-2020: 30%. (Note: We have a forecast update in the works that segments the market into subcategories.)

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Welcome back to integration technologies!!!

Henry Peyret

There’s a renewed interest in integration technologies due to new needs for integration to mobile, the Internet of Things (IoT), and cloud — but also because integration requirements betwen systems of engagement and systems of record are requiring realtime for seamless boundaries omnichannel, higher volume, with end-to-end security highlight the changes in integration practices. Forrester will soon publish a report about the integration trends around these subjects.

I am happy to pick up this subject again from Stefan Ried after being away from the space for the past six years. Stefan left Forrester in December and I regret his departure, because he was a very passionate analyst and a smart guy to work with.

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Why CIOs Must Care About New API Management Platforms. Hint, It's About Mobile Apps.

Ted Schadler

Thanks to the good work of my colleagues Eve Maler and Jeffrey Hammond, we have a new Forrester Wave on API Management Platforms, including evaluations of Layer 7, Mashery, WSO2, Intel, IBM, Vordel, and 3Scale. I won't spill the beans on the leaders, but I will share some of their analysis with my own interpretation to explain why you must care. First, let's define API management platforms as:

Middleware that developers use to publish and configure interfaces and that applications use at runtime to connect to the data services they need.

Here's why API management platforms matter:

  1. As you build mobile apps for customers, partners, and employees, you need apps that perform well over the last wireless mile. And that means you need a great, RESTful API that provides design-time and runtime access to data services hosted by your on-premises applications. Think of it as "cloud-connect" technology that lets the data inside your datacenter get out and back (securely) to the mobile app that needs it. As mobile apps get more and more transactional, the need for API management platforms will become even more critical.
  2. You are just getting going on the number, breadth, and complexity of the data service APIs you will need to build and operate. As mobile apps get interesting, with transactions, integrated applications, and more and better content and collaboration, you will need solutions that handle all those integration points. Think of it this way: RESTful interfaces give you the means, but now you need a system to handle the sheer number of APIs you are and will be building.
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API Management: A Key Component Of Modern Application Architecture

Jeffrey Hammond

I’ve previously written about how modern application architectures are shifting toward compositional, service-oriented architectures — “for real” this time. RESTful services using XML or JSON payloads proliferate because they’re easy for developers of omnichannel clients to use on virtually any device they need to support. It doesn’t matter if they’re building native apps in Objective C or hybrid apps with Cordova — if they can get an open web API call, it’s good enough to move forward.

This shift to web APIs and modern applications means that companies have to shift their API management strategy as well. They need to 1) create the web APIs and 2) create a life cycle to manage them. It’s this life-cycle element that’s conceptually distinct from traditional SOA governance solutions. For one thing, the services live on the open bus of the Internet and carrier networks. Another difference is that web APIs are increasingly made availabe to third-party developers. They may be part of a newly formed developer community, or they may support the growing number of digital agencies and mobile specialist firms that your company uses to supplement development projects. Security and access models are different (e.g., OAuth 2), provisioning access to APIs needs to support light-touch approval workflows, sandboxes where developers can test their calls are important, and analytics that detail call volume and how developers are using APIs are must-have capabilities. Above all, a developer portal that provides good documentation, example code, and quick time-to-value are important if you want to attract and keep developers.

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