How to Monetize APIs in Telcoms

With the summer over, industry focus turns to harvesting success in the last few months of 2019. Lately, we see that CSPs are launching the first 5G networks in different countries such as China, the US and UK – where we also already see 5G devices as phones and smart watches slowly being released.

Deutsch Telecom in Germany is introducing its first international NB-IoT roaming proposition ONE. 5G and Low Power Wide Area (NB-IoT, LoRa) communication infrastructure are becoming a reality, even though the demand for new communication technologies is still unclear today

But although almost a quarter of CIOs at network-based CSPs report their organization is already scaling their digital initiatives (cross-industry average is 14%), only 5% report they are realizing benefits so far in 2019, according to Gartner.

In my previous blog, I mentioned the challenge that Internet of Things ideation is presenting CSPs. Another challenge I am seeing generally is the upfront investment behavior of CSPs in IoT projects. IoT projects need upfront investment and time to spend creating the IoT ecosystem, the customer landscape, financial contributions and solution focus. Here we don’t always see clear planning in place, but more a short/midterm investment behavior pressured by short-term ROI expectations.

A solution could be API (Application Programming Interfaces) marketplaces, where CSPs can adopt and create new revenue streams by offering API-services subscriptions. CSPs already have the partner landscape and customer intimacy relationships with their connectivity play for IoT. Wouldn’t it be a natural fit to open an API marketplace for all their IoT community instead of trying to build the complex and expensive full end to end solutions? Then the CSP’s customers can build any type of solution with any type of data input. In the Netherlands, there is a CSP doing just that: KPN just launched their API market place.

Software AG’s webMethods.io API management software can help CSPs to advertise and monetize their APIs – and it enables application developers to quickly find APIs, documentation and assistance. WebMethods (on premises or cloud-based) enables the virtualization of service end-points, allowing service plans and packages to be created. The hybrid integration capability allows internal services to be exposed on the cloud API environment, for cloud-to-cloud as well as cloud-to-on-premises integration. 

Take a look below at Gartner’s API Monetization Ladder (right) which shows the abilities for CSPs to monetize API technologies.

Another major benefit we offer our CSP customers is that the API management software is easy to integrate on top of our Cumulocity IoT platform. This gives them the ability to offer existing API setups for quick data handling and event triggering or to do analytics to build applications for IoT solutions.

Today Software AG services more than 1,700 global businesses, including 7-Eleven, Staples, Commerzbank, Tory Burch and Tractor Supply – all of which currently use Software AG’s on-premises B2B platform (webMethods Trading Networks) to enhance their operational efficiency and successfully manage their customer and third-party relationships.

Click below to learn how to monetize your APIs.