Increasing Digitization in MNOs to Drive Telecom API Platform Market to US$5.23 bn by 2022

Application programming interface (API) is a technology that allows sharing of information between two different firms at an unprecedented scale. A large number of firms that have adopted APIs have increased their market valuation. The API platform is an API monetization and optimization software solution at the end-to-end level, essential for service providers to fit their data and telecom infrastructure into a commercial transaction platform. It provides expertise with tools and services for the purpose of API management, design, and reporting as well as analytics for the optimal functioning of API programs in order to maximize business revenue. Using API platforms, service providers can create and securely advertise new services directly or through composite APIs.

Telecom operators are rapidly understanding the need to embrace the API development since it results in the creation of new revenue generating services. However, there are many telecom operators who have not moved API development for various technological, financial, and cultural reasons. Operators that do not embrace the idea of API are slower to reach the market than their competitors and these service providers miss opportunities to collaborate with the Internet community that offer great expansion prospects.

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Telecom operators are recognizing the threat of OTT players and increasing competition with other MNOs, which is driving them to adopt API platforms as their new revenue streams. Telecom APIs provide an opportunity for operators to earn direct revenues by selling APIs to developers around the world. Therefore, the API market is largely untapped, providing opportunities for telecom operators who are looking to capitalize on the opportunities offered by APIs. There is a rapid adoption of digital technologies and applications by enterprises, consumers, and governments across the globe. This has led to unprecedented growth in data sailing over different operator networks pushing them to adopt API platforms. On the other hand, medium- and small-sized operators lack awareness of the benefits of using management platforms and are thus reluctant to invest in new technologies, which is restraining the growth of the telecom API platform market.

The M2M sector is being seen as one of the most valuable sources of growth for telecom operators. Thus, a large number of telecom operators are transforming their existing business models and aligning themselves to offer M2M solutions across a range of vertical industries, providing ample growth opportunities to the telecom API platform market in the near future. The global telecom API platform market generated revenues of US$ 1,369.0 Mn in 2014 and is projected to expand at a CAGR of 19.1% during the forecast period (2015 – 2022) to reach US$ 5,231.0 Mn by 2022.

On the basis of telecom operators, the telecom API platform market is categorized into T1 Players, T2 Players, and T3 Players. T1 players are telecom operators who have already taken telecom API management platforms and have been offering API services to their developers for the past few years. With rising competition and the efforts of telecom operators to digitize, the number of T1 players is also anticipated to rise rapidly, contributing to the growth of the telecom API platform market. T2 players are telecom operators who have begun offering telecom API services through telecom API management platforms and would want to expose his APIs externally to enterprises in the near future. T3 players are telecom operators who currently do not possess the capability to offer API services since they do not have tie-ups with telecom API management providers.

On the basis of module, the telecom API platform market is segmented into the set-up, and monetization, and pricing model segments. There is some contribution of T1 players in set-up since they already own the required infrastructure to offer API services. Furthermore, the monetization and pricing model is being attributed to the increasing spending of T1 players on monetization and pricing currently, further increasing the telecom API platform market’s growth.

Geographically, Asia Pacific, Latin America, and Middle East and Africa are anticipated to pick up late during the mid and long term of the forecast period. In 2014, key telecom API platform market players included Alcatel-Lucent S.A., Aepona Ltd., Apigee Corp., Huawei Technologies Co. Ltd., Oracle Corp., Hewlett-Packard Development Co., LM Ericsson, Tropo, Inc., Axway Software S.A., and ZTE Soft Technology Co., Ltd.

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