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Closed APIs

Ryan Frederick | June 2nd, 2020

I’m running across more companies with closed APIs for their products. This shortsightedness is not in the best interest of the product, the customers, or the company.

Our work as a digital product firm at AWH gives us the opportunity to engage with clients across a broad spectrum of industries, company types, and company sizes. Companies who are in niche and specialized industries that are dominated by only a few core software providers are the ones where closed API’s are more prevalent. These companies, along with some non-profit and social impact organizations, are being taken advantage of because they often don’t have robust technology teams and/or deep financial pockets. As a result, these companies and organizations are having to live with inferior, closed products.

The companies providing these core software products to the niche and specialized industries are keeping their API’s closed to prevent customers from leaving their product and company for a competitive product or so customers can’t build their own replacement product. These companies are holding their customers' hostage. In many cases customers can’t even get their data out of these “closed” products because it would be too painful to do it manually, the providing company doesn’t allow data-level access at all, and/or the providing company claims they have some ownership right to the data. So, what do customers do? They throw up their hands and continue to live with an inferior product and continue to do business with a company that is taking advantage of them.

These companies will claim they have a closed API or no API for security and privacy reasons. Sure, because no one has figured out how to secure APIs yet. Come on guys, you might be able to get away with pulling the wool over your customer’s eyes since they don’t have the experience or technical knowledge of building digital products, but we know what you’re doing.

Maybe these companies have a sound business strategy in locking down and locking customers out of their products. I think it is unethical and these companies should stop holding customers and the customer’s data hostage.

The companies might get a good run out of closing off their products, but in the end, they will pay for it. New entrants to the market will build open products that are easier to use and less expensive than the incumbent products. More and more customers will also build their own products after having enough of the games from the closed product companies. Both of these things are happening at a faster pace than ever.

If you are a company with a software product that has a closed API, I encourage you to open the API and to work in the best interest of the product and your customers. You shouldn’t operate in fear mode and with fear-based tactics. And if you continue to do so, your day of reckoning is coming.