Partners benefit from TransUnion data based on their own approach to market. "It might be credit management, identity theft protection, lead generation, there are a lot of variations on the theme," says Metzger, and he monitors API traffic to improve his services.
The actual credit information is regulated and remains secure behind the company's firewall. TransUnion's enterprise infrastructure was built on a service-oriented model and first used Sonoa for internal application interfaces. Now Metzger uses the API interface as a "policy layer" to meet regulations, enforce compliance with the terms of the agreement with the partner and maintain service levels. TransUnion Interactive uses Tibco Spotfire to aggregate large data sets, confirm expected patterns or nail down the cause of unexpected ones.
The intrinsic value of Web data services, Metzger believes, is the ability for any organization to reuse the core capabilities they've developed over the years. "With the economic climate of today, companies are looking at how they can monetize the assets they already have instead of doing high risk R&D on new products."
There is no aggregate market data on API volume, but Salesforce and NetSuite report a majority of data transactions are now consumed through APIs rather than browsers, and other providers report the same. Anecdotally, Zoho desktop productivity software evangelist Raju Vesegna reports that API transactions for data stored by his company will increase from 50 percent to 80 percent of the total in the next 12 months. And Omniture, which holds sway in the analytics space for Web site reporting, launched a new service for monitoring API transactions as recently as October.
Every SaaS vendor and application that doesn't have an API today soon will, Musser says, because that's the way data becomes glued to other cloud or enterprise apps. "Just as every enterprise platform has had something you could build on for the last 20 years, whether it was Oracle or Windows, that will be true for every cloud platform because APIs are the glue of SaaS."
Web Data Services
No single boundary defines what a Web data service provider is, but all allow interaction with data streams directly or indirectly. Some originate proprietary feeds, some redistribute those feeds and some build software and analytics that gather competitive information or scour social networks or blogs. Still others offer cloud infrastructure and analytics to sift the data gathered from any source. Most can be used inside or outside the firewall.
It's an emerging and vibrant data marketplace almost too wide to document. There are intermediaries like StrikeIron that work with traditional look up services and sell metered access to D&B or address verification on a per-API call basis. InsideView aggregates primary sources from LinkedIn to Thomson Reuters to integrate contact info, management changes and product news into its customers' CRM applications. Some startups, like Jigsaw, create value based on the data contributed by members and make their money on enterprise licenses. (See story sidebar "The Communal Data Service" at the end of this article. -ed) Another startup called GoodData provides a SaaS analysis tool and cloud infrastructure for clients to upload and crunch Web site data unsuited to their own databases or data warehouses.
"Sometimes you bring your own data, skills and technology to the surface," says Phil Wainewright, a London-based consultant. "But just as importantly, there are a lot of opportunities for a startup to make money by chasing money back to someone else."
And while API traffic looks like a bellwether of a data service economy, APIs are not required to gather and parse the majority of content on the Web that exists in unstructured form. Connotate, Mozenda and QL2 are prospering with screen-scraping services. Another vendor called Kapow expects that refined robotic scraping of content already outweighs the benefits of programming interfaces. (See story sidebar "Point and Extract" at the end of this article -ed)
By redirecting data, brick-and-mortar businesses can move from a product to a service model. Jeff Kaplan, founder of consultancy THINKstrategies, thinks of payroll processor ADP as an early example of a mainline business that morphed into a multifaceted SaaS model.
"Look at ADP and ask yourself, is this a software company or a business service company or an information service company?" To Kaplan, it's all three, a software-enabled business service and information provider. Along with regular payroll, ADP has added insurance, retirement and standalone services tied to its records that help HR departments manage and retain unique employees and look at new staffing needs.
"When you add insight to information, that can change the way people behave, and now you're talking about exerting influence in the marketplace." That's powerful stuff, Kaplan says.
The more services are aggregated, the more they become units of currency in a data economy. And services that can be packaged or bundled offer increasingly complete views of information to customers. Salesforce.com originated as a CRM application but is now an integrated network of more than 1000 applications and services that dwarf its original mission and value.
Data services that are integrated to enterprise applications reflect the most powerful form of data service usefulness. "A SaaS provider like Salesforce.com is a classic example, because the Salesforce API brings integration into all of the intelligence sources in an enterprise," says Musser. That includes HR, BI and transactional systems and explains why the API Web integration is displacing browser traffic.
"The most relevant thing in the cloud are SaaS enterprise apps like Salesforce because the already have a schema and a database that's organized and not freeform," says Forrester analyst Rob Karel.
While Salesforce or NetSuite are traditionally products for the small and midmarket, their effect is not lost on enterprise software vendors. Integration platform provider Informatica touts an ability to incorporate external data feeds in the latest release of its platform. SAP's new BI Explorer tool appeals to users of external databases; a research note from Saugatech says SAP's unsubtle reorientation to cloud technology is "now central to the company's future success."