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Recently published Ovum report, Ovum Decision Matrix: Selecting an API Management Solution, 2016-2017 revealed several interesting market trends, including a major shift away from fine-grained service governance, emergence of API platform-as-a-service (APIPaaS), and stiff competition between specialized API management vendors and major vendors offering API management.

Ovum expects competition to further intensify in the near future

Specialized API management vendors and a couple of major middleware vendors are among the market leaders. As indicated by the results of this comprehensive evaluation conducted by Ovum, there are a couple of distinct clusters, representing vendors with relatively small differences in overall scores across technology and execution dimensions. There is stiff competition between market leaders, and successful execution of an aggressive product strategy and roadmap, and expansion into new regions and market sub-segments will determine how the vendor positioning changes over the next two-to-three-year period.

Continued success in this market will not be determined by technological prowess, size of customer base, or aggressive sales and marketing tactics. It is less about selling a good software product and more about developing competences to function as a strategic partner to enterprises embarking on digital business/transformation initiatives involving the use of APIs. Ovum expect more partnerships and acquisitions in this space over the next couple of years as specialized API management vendors realize the need to develop an end-to-end proposition in combination with middleware stack vendors.

The premise that API management is "service-oriented architecture (SOA) governance with better tools" does not resonate with the practical requirements of enterprise API initiatives that aim to meet specific business objectives. There is a strong belief among developers, integration practitioners, and enterprise and solution architects that fine-grained service governance is of limited use in the current operating environment. Enterprises following an SOA governance-led approach for meeting API management requirements of digital business initiatives are likely to fail.

Interestingly, API management itself is undergoing a transformation toward becoming a more comprehensive approach delivering API creation and composition capabilities along with end-to-end API management. This is important because an API created without due consideration of expectations and requirements of API consumers will fail to gain any significant traction. We define such a combination of API creation and end-to-end API management capabilities delivered via the cloud as “API platform-as-a-service” (APIPaaS).

Ovum forecasts the global spend on “standalone” API management solutions to grow at a CAGR of 31.8% between 2015 and 2020, crossing the $1bn mark in the first half of 2019 (see Figure 2). Asia-Pacific (Asia-Pacific) will be the fasted growing regional market, and is estimated to grow at a CAGR of 36.7% over the forecast period. The regional market in Americas is expected to grow from $304.4m in 2016 to $871.6m by end of 2020.


Further reading

Ovum Decision Matrix: Selecting an API Management Solution, 2016-2017,IT0022-000652 (April 2016)


Saurabh Sharma, Senior Analyst, Middleware

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