State of API Report Highlights Productization and Generative AI

In today’s software landscape, an API-first strategy is increasingly popular. It’s the bedrock of how applications are built and connected. APIs help promote internal tech reusability, helping developers do more with less. Due to this increasing API reliance, maintaining quality control is increasingly important for internal and partner integrations and ensuring the reliability and security of these connections remains a top priority.

Due to the rising API ubiquity, nearly half of the total development energy is spent working with APIs. And to continually improve these interfaces, taking a product mindset is proving helpful. In fact, 60% of API developers now view their APIs as products. Generative AI has also shown incredible promise and is now being used in tandem with traditional tools to increase API code quality.

Postman recently released its fifth annual State of the API Report. The 2023 edition, which surveyed thousands of developers and API professionals, found subtle changes in tooling preferences and styles. It also sheds light on the ongoing API productization movement and API developers’ use of generative AI. Below, I’ll focus on these two key areas and review the report for its other key takeaways.

API Productization is Hot

The majority of API developers now view their API as a product, and this figure rises to 68% in large companies. A full 65% of respondents said their API generates revenue, too. This news is significant, as it demonstrates the industry is maturing its view of APIs. They are no longer offshoot developer toys but fully functional services contributing to overall business growth.

But how much growth? Well, of those monetizing APIs, 43% now say APIs generate a quarter of company revenue. For some companies, APIs generated more than 75% of total revenue! There also appears to be a parallel between API revenue generation and large companies.

Do you view your APIs as products? Most developers say "yes." — Do you view your APIs as products? Most developers say yes.

Other industry reports unearthed similar API productization potential. Rapid’s 2022 State of APIs report found that 42.6% of organizations are now monetizing APIs. And investment into API-first products remains strong even amidst a broader contracted tech investment climate. These findings come as social media giants like Reddit and Twitter attempt to monetize their APIs.

That said, for 28% of companies, API revenue still equates to less than 10% of total revenue. APIs still don’t get the lion’s share, perhaps because they’re packaged with an existing platform or because of the many other indirect ways APIs might benefit the business. Furthermore, consumers are becoming more cost-conscious, as 60% cite pricing as a factor before integrating with an API. Still, the numbers are significant firsts for the burgeoning economy.

Most API Developers are Using Generative AI

Generative AI interfaces like ChatGPT and Bard have certainly taken the tech industry by storm due to their ability to generate code snippets, debug code and more. And for the first time, the State of the API Report spotlighted generative AI and its use within the API economy.

Today, 60% of API professionals are using generative AI on the job. API engineers commonly use generative AI to find mistakes in code, generate machine-readable code and increase learnability around their programs. Some even use generative AI to suggest potential security flaws in their APIs.

Compared with other app development endeavors, developers are by far most excited about building generative AI-powered applications in the year ahead. Yet, the efficiency gains are modest—many engineers forecast productivity improvements of 10% to 25%.

How are API developers using generative AI in their work?

Generative AI is set to accelerate many areas, including DevOps and API operations. Yet, contrary to some headlines, generative AI can’t automate all aspects of the software development life cycle. Rather, the technology is more likely to augment the API developer’s workflow than replace the need for seasoned professionals altogether.

Other Key Takeaways

Similar to last year’s report, integrating between internal applications, programs or systems remains a top concern for integrating an API or producing an API. The good news is that these integrations continue to increase in quality.

The report found that deployment failures and times-to-recovery are improving on average. More than half (56%) of respondents said API security incidents occur less than once a year within their organization. This shouldn’t overshadow the significant impact API security breaches can have but signals that DevSecOps is beginning to respond to persistent API vulnerabilities.

There are more API-first leaders than ever before. And API owners continue to evolve how their services are built and deployed. For example, REST is still by far the most common API style, used by 86% of developers. Webhooks made second place at 36%. However, GraphQL rose in usage, bumping SOAP into fourth position.

SOAP slips on API architectural styles — REST is still the dominant style, but GraphQL makes gains as SOAP slips.

Other Quick API Factoids

More non-developers are becoming interested in APIs, as evidenced by 53% of survey takers being non-developers.
Most APIs are private—61% percent of businesses’ APIs are for internal use only.
After the technology group, business/IT services, financial services and health care are the most common sectors to adopt APIs.
Microservices is still the dominant architectural style of APIs, at 42%.
Performance, security and reliability are the top factors evaluated when integrating with a new API.
Improper authentication, authorization or access control is the most commonly cited API risk.
Common API tools include Postman, SwaggerHub, Datadog, SoapUI and Insomnia. Top gateway and API management platforms include AWS API Gateway, Azure API Management, Apigee and Kong.
JSON Schema is by far the most popular API specification.
The financial industry is a leader in API-first strategies—32% of respondents spend more than 20 hours a week working with APIs.
Most developers deploy APIs to production once a week to once a month.
When developers leave a company, their departure can cause outdated documentation, zombie APIs and a loss of institutional memory.

API Obstacles Remain

Looking to the future, investment in APIs is projected to climb. In fact, 92% of developers said their organization plans to invest the same or more time and resources into APIs in the coming year. Yet, some obstacles remain—a lack of documentation and poor service discoverability are still prominent roadblocks to API consumption. Furthermore, a lack of time and talent are major concerns that might stunt API development.

The Postman State of API Report surveyed over 40,000 developers and API professionals, making it the largest study conducted on APIs to date. It should be noted that, given Postman’s specific focus in the market and its surveyed pool, figures may be skewed to represent increased API enthusiasm. For deeper insights, you can read the entire report here.