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Wheelings & Dealings: Red Hat Picks Up API Management Company

By Paula Bernier
June 29, 2016

There’s been lots of API acquisition news happening in the space just this week. Wow. Things are really heating up in the application programming interface arena.

This time it’s open source pioneer Red Hat that’s doing the acquiring and 3scale that is being snapped up.

Red Hat said it’s buying the API management company to play a bigger role in the API economy, and help simplify cloud integration and microservices-based architecture.

“Managed APIs are becoming strategic in the enterprise because they enable organizations to rapidly deliver new services that are easy to consume yet secure, scalable, and reliable, as well as enabling services (as APIs) to be monetized as products,” Red Hat noted.

“Emerging architectures that decompose functionality into ever more finely-grained components – microservices– driven by mobile, the Internet of Things, and other trends, have further heightened the need for API management.”

In an interview with me back in October, 3scale CEO Steve Willmott said his company’s solutions helped turn APIs from toys into business tools by making them higher performance and more secure. The company offers its solution as a platform with gateway and SaaS components.

Willmott credits 3scale, eBay, Flickr, and Salesforce as among the key companies that helped popularize the API. For example, he said, eBay in the 2003-4 timeframe introduced APIs as a way for people to upload at once an array of products they wanted to sell.

Similarly, Flickr early on began to open its service with APIs, which people could use to upload photos, he added. Salesforce was clearly also early to the API game. The CRM giant was able to use APIs as a way to incentivize other software companies to integrate with its SaaS offering by making it relatively easy to do so. It worked; today Salesforce is a software leader, the frontrunner in the CRM space, and is recognized as having one of the strongest ecosystems in the software arena.

Today, of course, everybody and their brother seems to be interested in APIs. Cisco earlier today announced plans to buy API company CloudLock. APIs are also drawing heavy interest in light of Twilio’s stock market debut last week, which valued the company at more than $1 billion.

If you’re interested in learning more about why Red Hat is acquiring 3scale, why Cisco is buying CloudLock, and how Twilio hit a valuation above $1 billion – and how your company can get in on the action – join us for All About the API  July 19 through 21 at Caesars Palace in Las Vegas.

Edited by Stefania Viscusi

Executive Editor, TMC

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