Facebook, through its platform offering, ushered in a wave of website application innovation. For large web and mobile technology ventures, it is no longer enough to focus just on user adoption—developer adoption of a platform has become just as important. No amount of users can substitute for a cadre of independent developers. The most successful companies, such as Twitter and Facebook, now prioritize their API users the same way first generation web companies catered to unique website visitors. By supplying a platform for third-party developers to build upon, companies can harness outside creativity to drive growth on their platforms. API adoption has led to follow-on innovation and, in many cases, development of critical features that redefine the underlying platform.
For example, Facebook looked to platform application developers like RockYou and Slide to create new ways for users to interact with each other and entertain themselves on Facebook. From 2007 to 2008, the number of applications on Facebook’s platform grew from 7,000 to 33,000.
Most platform TOUs change frequently. The experimental nature of APIs often leads to permissive rules at first, and tightening restrictions over time.
From its launch, Twitter’s platform has been a major tool for third-party developers. Its API fueled growth for a plethora of applications by providing access to the fire hose of tweets. Independent developers built Twitter’s first and best clients on mobile platforms, such as Apple’s iOS and Android, via its API. Over time, Twitter modified its contract with developers by expanding access to Twitter’s underlying data. As the platform matured, however, proliferating applications offering Twitter clients made it difficult to maintain a consistent UX. After years of such proliferation, further API TOU changes followed.
When viewed through the lens of governing third-party developers’ relationships with a host company’s users, API TOU changes such as Twitter’s and Facebook’s are no surprise. One hallmark of the user-generated-content, viral, or ‘Web 2.0’ set of technology companies has been rapid growth. To this end, APIs are an effective marketing tool when leveraged by “growth hackers.” As host companies mature, however, so must their platforms. The resultant trend, exhibited by both Facebook and Twitter, is towards more closed platforms governed by increasingly restrictive TOU. It remains to be seen whether the world of restrictive API TOUs is the new normal, or if an alternative solution will emerge. For now, platform companies such as Facebook, Twitter, and LinkedIn seem to be turning to more mature and strictly governed contracts with their application developer users.
In the Platform 2.0 world, developers can no longer utilize platforms as a loose user acquisition tool or data pipeline; they must now operate in a more defined and limited space. Many applications once produced by third parties will now be created and maintained in-house. Ultimately, from consumers’ perspectives, the current trend of raising the bar for platform application development through TOU changes hopefully portends higher quality user experiences.