Difference between Public APIs and Private APIs: An Insider’s Guide

Public vs Private APIs

In our article What is API Integration? We covered some basics of API Technology; however, there is another big part of the APIs story which we will cover here. What are public APIs and Private APIs and how they can affect everything from the type of data being shared, with whom it is shared and to what extent. In this article, we give you the insider’s guide to Public APIs vs Private APIs and some tips on how you can use these to benefit your business.


Today when people talk about APIs, more often than not, they are talking about Public APIs also known as Open APIs or External APIs. Why? You might ask! Well, the answer is hidden in the name i.e. Public APIs are public for a reason. These APIs are everywhere and everyone’s using them from your favourite website to your mobile apps and much more. So what is Public APIs and why do we need Private APIs if they are so widespread?


Public APIs

Public APIs present a standardized set of directions to be followed in order to access the information/ data and services which are being shared outside of an organization to the public domain. The developer can then use this information to then build a whole new application on top of that. The set of directions to be followed is presented in the API Documentation by the API provider. This concept is somewhat similar to the opensource software. Once the developers have access to the API, they can pretty much do whatever they want with this data to create something unique.


Illustration for flow of information in Public API


Source: Wikipedia


These kinds of APIs are beneficial to not only the developers but also to the companies that create them. Companies like Salesforce are seeing an increase in business through their APIs. In fact, outpacing their original focus, reportedly generating more than 50% of their revenues through APIs. Similarly, companies like Twilio have shown how profitable a good idea and a great API can be. For Twilio, their API is their sole business and in 2019 their reported revenue was $1.13 billion.


What can you do with Public APIs?

  • Great way to share your data/services to the public
  • Create a seamless flow of data to and between your devices
  • Find new and better ways to create integrations and partnerships
  • Detailed analytics and information regarding your audience, traffic, usage and much more.
  • Increase your brand value
  • Generate a new value/revenue stream for your business.

Benefits for businesses using Public API

Businesses using Public APIs can benefit significantly, here are a few listed below.


1. Enhanced Data availability

When you integrate a Public API to your new Application you get access to all the data already stored in the provider’s database. Businesses can use this data to realign their services and make better more informed decisions.


2. Automated Content Publication

With help from Open APIs, businesses can automate their content publications directly from the provider’s database.


3. Better Customer experience

Public APIs can enhance your new application in many ways, as described above which all can add up to a much more intuitive and interesting experience for your consumers.


4. Flexibility in data migration

Through APIs, it is possible to script the web interfaces of providers to automatically migrate data. This is a much more convenient way for migration instead of manually handling all related tasks.


5. In-depth Analytics

Integrating these APIs can provide you with great details about your audience, user preferences, usage, and traffic. Based on this information you can make better decisions for growing your business.


6. Reduced Costs

Development costs are constant no matter what API your new application may use. However, a lot of human tasks can be handled through automation APIs. This can not only save time but a lot of manhours as well.


7. New Opportunities for customer database growth

Most online businesses rely on the number of people who get access to their content through the web. You can in practice increase distribution of your content without APIs however, APIs can be used to truly maximize penetration.


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Private APIs

As now you have a clear picture of what Public APIs are and how they can benefit you. Lets now look at Private APIs, while you may not have heard much about Private APIs, Private APIs are probably far more common. These are arguably even more beneficial than Public APIs from a business standpoint (especially for small businesses). What Private APIs lack in the form of general market consumption/penetration they gain that much more in terms of productivity, partnerships and facilitating service-oriented architectures. Let’s take a deeper look for better understanding.


Public APIs have to maintain certain restrictions because of their generic target audience, Private APIs don’t have to suffer this limitation. Private APIs aka. Internal APIs provide developers with an open architecture to work with. this approach gives the developer an easy way to plug-in to the backend system, data, and software. All this minimizes the time and effort needs of the developer leaving more room for ingenuity and speed. This often means the company (especially true for smaller businesses) remains competitive due to high productivity, lower costs and improved efficiencies.


What Can Private APIs Do for You?

  • Internal Applications
  • Increased customer focus
  • Partner Integration
  • Streamlined Data Collection
  • Collaboration between Teams

Benefits for businesses using Private API

Let’s explore how Private APIs can effectively benefit your business.


1. Automation of repetitive tasks

Private APIs don’t have limited access to company resources. These can be used to automate repetitive tasks that would otherwise take up huge chunks of time. A good example of this might be handling and forwarding customer queries from your web-store directly to relevant departments. Automation also reduces the chances of human error, since computers handle all tasks the chances of data discrepancy become zero to none.


2. Private Applications for Use Within Company.

Companies can develop applications for internal use based on private APIs. These applications can gain access to company data and resources. Hence, increasing the flow of information across the board. Companies like Amazon & Google already use private APIs to streamline the flow of information through Private APIs.


3. Speed up Time-To-Market

Having an internal API can greatly speed up the time-to-market of service features and new products.  Since private APIs don’t need too much time to write documentation or resolve coding issues. This time can be used to make a more efficient API. This results in a quick turnaround for your business overall.


4. Data Analytics & Business Intelligence

From data collection to predictive analytics tools to business intelligence, Private APIs can help you make more informed decisions. Machine learning is the hottest cake in the market right now. However, these algorithms are not easily accessible or useable. Thanks to Machine Learning APIs Businesses can now use Machine learning APIs to sift through data derived from internal sources and assets. this can give deep insights and sometimes offer unique new opportunities and/or solutions.


5. Higher Customer Engagement Rate

Customer engagement or customer experience is critical to any business’s success. Higher the customer experience is, higher the chances are the chances for customer retention and sales. With an API based contact centre backing up your customer engagement strategy, you can remain agile and experiment to further improve and capitalize on customer trends.


6. Partner Integration

Sometimes businesses allow access to internal data resources to their partner concerns. This ensures a faster flow of information eventually resulting in much faster solutions to the end consumer. Although there are certain data risks involved with sharing your data with another concern. With mutual trust and understanding between two businesses, this can greatly enhance the aforementioned customer engagement rating through faster more agile solutions.


7. Time-Saving + Cost-Saving = Untapped Revenues

Relevant to Point 1 and 3, private APIs greatly impact your team’s time savings. Both through service implementation and solution development times. This added time can then be spent focusing on further value addition to the customer or can also be used as a cost-saving mechanism. Hence, either way, allowing you to find newer ways to save or generate revenues.


8. Manage Supply Chain / Improved Ordering

Although certain Public APIs also perform such tasks internal APIs benefit more from this due to their enhanced access to company resources. Businesses can layout a detailed integration plan that internal APIs can then implement through their access to company resources.


Conclusion: Public vs. Private APIs

Summing up both Public and Private APIs have their benefits and it’s up to businesses to identify which can be truly beneficial to their needs. Some times even a combination of both of these can be used to maximize business benefits. API management providers/specialists can help identify the best pathways for your business also, not only assisting in designing a strategy but also what to implement where.


To find out more and for free advice on your API implementations, you can reach out to Help Square.

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