Global Telecom API Platform Market to Gain from Digitization Investments by Telecom Operators

by John Warner Market Research

Application programming interface (API), is a standardized set of instructions that allows an application to perform certain functions. For instance, an application that needs to access a system file depends on the API of the operating system to perform the task. A program’s interface, thus, lays down a defined way for a developer to exchange information with a particular program. The API platform functions as a software solution that helps optimize and monetize APIs end-to-end. In the context of the telecom industry, an API platform is important because it helps service providers to fit their telecom infrastructure into a commercial transaction platform.

With mobile network operators racing toward complete digitization, the role of API platforms becomes undeniably central. As a result of this increasing reliance on API platforms, the global telecom API platform market is expected to exhibit a spectacular CAGR of 19.1% between 2015 and 2022. The market accounted for US$1.37 bn in revenue in 2014 and is expected to exceed US$5.23 bn by 2022, says a new report published by Transparency Market Research.

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Europe Represents a Third of Global Telecom API Platform Market, Standing Tallest Among All Regional Markets

The telecom API platform market in Europe was the largest in the world in 2014, representing a third of the global market. With an estimated 402.9 million internet users in the European Union, the European region boasts a relatively high degree of internet penetration. The easy access to the Internet has created a fertile ground on which the e-commerce and m-commerce sector thrives. This is one of the most important factors that has compelled telecom operators to rely on API management platforms, putting Europe at the top of the global telecom API platform market.

Telecom Operators Turn Toward API Platforms in Quest for New Revenue Streams

Application programming interface (API) platforms are being monetized in several different ways. While some APIs charge a subscription or call rate, others are monetized using a model that encourages users to upgrade to a premium subscription package. In the face of intense competition, mobile network operators (MNOs) are forced to consider creating new revenue streams. API platforms play a vital role in this endeavor, fuelling the telecom API platform market across the world.

Small- and Mid-size Telecom Operators Still Reluctant to Invest in API Platforms

It is mostly the large telecom operators (T1 players) and not their small- and mid-size contemporaries (T2 and T3 players, respectively) that invest in API platforms. This leaves a space that API platform vendors have hitherto failed to extract appreciable business volumes from. Thus, the continued slow pace of adoption of API platforms among small and medium telecom operators will likely impede the growth of the global telecom API platform market. Nevertheless, companies in the global telecom API platform market can make up for lost opportunities on this front by focusing on the massive opportunity that lies in the growing number of M2M connections.

Some of the leading companies in the telecom API platform market are: Alcatel-Lucent S.A., Apigee Corp., Aepona Ltd., Oracle Corp., Huawei Technologies Co. Ltd., LM Ericsson, Hewlett-Packard Development Co., and ZTE Soft Technology Co., Ltd.

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