Revenue of the SaaS API segment in the cloud API market increased at a robust 15.8% year-over-year in 2021. Demand for SaaS APIs increased by nearly 1% between 2020 and 2021, giving the combined cloud API market year-over-year growth of 17.5% in 2021.
Overall, the market is slated to surge at an impressive CAGR of more than 19% over the next ten years, and get close to a US$ 9 Bn valuation by 2031.
Find Out More about the Report Coverage
- IBM Corporation
- Google LLC
- Oracle Corporation
- Microsoft Corporation
- SAP SE
- Amazon Web Services, Inc.
- Apigee Corporation
- Broadcom Inc.
- Red Hat, Inc.
- TIBCO Mashrey
- Axway Software SA
- Salesforce.com, Inc.
- Dell Inc.
- Adobe Inc.
- Citrix Systems Inc.
Report Also Addresses:
- Market Estimates and Forecasts (2016-2031)
- Key Drivers and Restraints Shaping Market Growth
- Segment-wise, Country-wise, and Region-wise Analysis
- Competition Mapping and Benchmarking
- Brand Share and Market Share Analysis
- Key Product Innovations and Regulatory Climate
- COVID-19 Impact on Cloud API and How to Navigate
- Recommendation on Key Winning Strategies
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Demand for Cloud APIs from 2016 to 2020 Vs Market Projections for 2021 to 2031
Historically, from 2016 to 2020, use of cloud API increased at over 15% CAGR, wherein, developed countries such as the U.S., Canada, Germany, and the U.K. held significant share in the global market.
On a global scale, businesses are increasingly moving toward cloud APIs for digital transformation. Cloud APIs for companies is emerging as important components to merge old and new IT platforms and capture and store a vast amount of data.
A business model of a majority of companies exists around the Software as a Service (SaaS) platform. Moreover, many mobile applications depend on APIs. Hence, tech-savvy companies rely on public, private, or partner APIs. Companies are providing comprehensive cloud API platforms by focusing on usage, access control, and documentation, and also on how DevOps will handle maintenance.
Cloud computing in healthcare is the fastest-growing technology, and cloud APIs work as a gateway providing indirect and direct cloud infrastructure and software services. Majority of companies are also entering into mergers and acquisitions to provide cloud API platforms in order to support analytical capabilities. These emerging trends are influencing organizations to adopt cloud APIs at a rapid pace.
Considering these statistics and shift in dynamics, the market for cloud APIs is forecast to expand at a healthy CAGR of more than 19% over the coming 10 years.
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What are the Key Opportunities for Cloud API Solution Providers?
Currently, end-user expectations from various services are significantly high, owing to technological advancements. End users’ requirements are not centered just on the app, but they also expect some add-ons or innovation. This constant innovation cannot be done by the organization alone, as they also need to focus on delivering product/services. Hence, this activity can be taken up by supporting partners and third-party developers through the use of data gathered from cloud APIs.
Furthermore, data from all cloud API-enabled endpoints can be gathered to gain insights on end-user behavior and also the amount of data streaming across various channels. This data can be analyzed in real-time, which will impact decision-making of the enterprises. Hence, end-user industries can integrate such types of applications into their systems in order to enhance their decision-making process, which is additionally creating lucrative growth opportunities for cloud API solution providers.
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What are the Restraints That Cloud API Providers Encounter?
Large-scale enterprises use apps internally as well as externally, which have a point-to-point integration, due to which, documentation is not maintained efficiently. Hence, it creates a challenge to integrate these apps with modern apps that are developed using new and advanced technologies.
Also, reduction in IT budget significantly impacts investments in applications requiring cloud API services. These are some factors expected to restrain growth of cloud API and management platforms to a certain extent.
Moreover, it has been observed that, enterprises tend to sideline the documentation of cloud APIs, which results in developers making use of an API service that is more convenient. This often results in the most ideal/relevant API not being integrated with applications, which, in turn, reduces the efficiency of the application.
Will Sales of Cloud APIs Gain Traction Due to the Full Lifecycle Management Trend?
Historically, APIs didn’t route to the entire application and were generally considered standalone assets that could be monitored with a dashboard and a graphical user interface (GUI). Today, modern APIs are intrinsically linked to the applications they’re developed for, as well as the resources they’re developed on. This, added to the fact that APIs are flourishing at an unparalleled rate, creates an API landscape that could be quite challenging and complex to manage.
Therefore, full lifecycle management APIs have been introduced to bring some kind of standardization that ensure APIs are created in a way that makes them easy to manage at scale.
API full lifecycle management solution entails managing the entire lifespan of an API, right from designing phase, updates, publishing, retirement, and other associated things. This helps ensure that standards and practices are implemented into APIs, making the entire landscape a lot easier to manage.
Which Region Offers the Largest Opportunity for Sales of Cloud APIs?
With an absolute dollar opportunity of around US$ 1.8 Bn, South Asia & Pacific is expected to be the most lucrative market for cloud API vendors. Currently, ASEAN is leading the South Asia & Pacific market; however, India is expected to witness double-digit growth during 2021-2031.
Under the ‘Digital India’ programme, the government of India launched an open API policy known as India Stack, which enables integration of mobile applications with data provided and stored by the government in authenticated apps. The open API initiative is expected to explore significant opportunities in financial services, healthcare, and education sectors of the Indian economy.
For instance, e-Commerce businesses based in India such as Flipkart, Myntra, and others are leveraging APIs to enable the development and management of applications for customers, partners, and vendors, thereby augmenting cloud API sales.
How is the U.S. Cloud API Market Expected to Shape Up Over the Next 10 Years?
The market in the U.S. is estimated to expand at 14% CAGR from 2021 to 2031. High dominance of digitalization and cloud platforms is one of the major factors that provides a dominant position to the U.S. for cloud application programming interface.
Also, high presence of top leading companies such as Google, IBM, Microsoft, and Oracle have uplifted cloud API demand in this country. Moreover, with growing demand for better mobile applications, many telecom companies based in the U.S. are adopting cloud API services in their portfolios.
Apart from purchasing cloud API services from third-party vendors, many telecom companies in the country are currently offering their own cloud APIs in order to allow integration of their services into applications and programmes designed by other software developers.
What Makes the U.K. a Hub for Cloud API Demand?
In 2020, the U.K. accounted for over 19% share of the European market for cloud APIs. APIs are gaining popularity in the BFSI sector across various countries in Western Europe.
To cope with consumers’ expectations for faster and convenient access to their funds, cloud APIs are being adopted to deliver innovations in the banking sector in the region.
Countries such the U.K. and Germany are witnessing growth in trends of development and adoption of open cloud API services, and are also gaining continual support from governments for enhancement and implementation of API technology in the BFSI sector.
What is Scenario in India for Cloud API Demand?
The Indian market accounted for around 17% share in cloud APIs, in 2020, and is projected to witness a high CAGR of over 27% during the forecast period.
Indian companies are using APIs to integrate with different systems and focus more on their core business. e-Commerce companies can now concentrate on products and discounts without worrying about building the payment process, which is taken care of by bank APIs.
The government too has become very active in the API economy, with initiatives such as Aadhaarapi.com and indiastack.org. It has various APIs on data.gov.in, which provide data on weather, air quality, elections, commodity prices, various government schemes, and more, and can be leveraged by businesses.
Why are SaaS-based Cloud APIs the Most Sought-After?
SaaS cloud APIs accounted for more than 30% share of the global market. The SaaS APIs segment was the highest contributor to cloud API sales in 2020, and is projected to remain dominant during the forecast period due to rise in software-centric approach for almost all smart devices among various industry verticals.
Furthermore, increasing development of software applications such as mobile apps that are high in demand among individuals across the globe is also augmenting the growth of SaaS APIs.
Nevertheless, the IaaS APIs segment is expected to witness strong growth, owing to rise in migration activities among industries, especially in China, India, and South Korea. As a result, major players are developing distinctive products for migration processes.
Why are Large Enterprises Likely to Use Cloud APIs on a Larger Scale than SMEs?
Large enterprises accounted for more than 50% of overall demand for cloud APIs in 2020. Healthcare companies are moving toward innovating services and processes, including the delivery of vital information to patients, insurance companies, and patient support services.
All these activities require a reliable system; hence, cloud APIs are witnessing increasing demand across the healthcare industry. Companies are adopting API models to offer innovative services and products. Driving efficiency, enabling automation, cost saving, and consistency are some of the factors resulting in increasing use of cloud APIs.
Which Industry Holds Lucrative Avenues for Cloud API Solution Providers?
The healthcare sector is estimated to showcase tremendous growth of 23.5% CAGR for cloud APIs over the forecast period. A large number of adults consume dietary supplements to address malnutrition issues. Patient-centric healthcare is an emerging trend in healthcare delivery, which has resulted in improvements in care quality, higher patient satisfaction, and better outcomes.
Emergence of services such as wearable medical devices and remote patient monitoring has increased demand for healthcare API solutions, which provides patients with details about specialty, timing, and experience of a doctor before consulting them.
- For instance, in April 2020, Google announced the launch in general availability of Cloud Healthcare API, a service that facilitates the exchange of data between healthcare applications and solutions built on Google Cloud. The API allows organizations to ingest and manage data from a range of inputs and systems, and then analyse that data through the use of privacy-preserving AI and machine learning.
Why Has COVID-19 Skyrocketed Sales of Cloud APIs?
Demand for cloud APIs is expected to grow during the COVID-19 pandemic outbreak. These cloud APIs help upload real-time data on the cloud for use by frontline authorities such as researchers, healthcare professionals, and government experts.
Moreover, global lockdowns did not impacted the IT industry to a great extent, which, as a result, maintenance of cloud APIs was possible by service providers such as Amazon Cloud Watch API.
Majority of companies have focused on acquisitions and strategic collaborations to establish their market presence in various developing regions. Strategies include innovation, collaborations with key players, partnerships, strategic alliances, and strengthening of regional and global distribution networks.
Some of the key developments are:
- In May 2021, IBM acquired Waeg, a leading salesforce consulting partner in Europe, to extend IBM's portfolio of salesforce services and advance IBM's hybrid cloud and AI strategy. The acquisition was built on IBM's continued investment in salesforce consulting services to meet rising client demand for experience-led business transformation and new customer engagement strategies backed by data, AI, and machine learning.
- In December 2020, Microsoft Corp. and Deutsche Telekom Group announced an expansion of their partnership that will help organizations of all sizes accelerate their cloud transformation initiatives. By combining Microsoft’s cloud and AI capabilities with Telekom’s Cloud Migration Framework and telecommunications services, companies aim to enable customers increase their productivity, build more agile and resilient operations, and deliver new cloud offerings faster.
Similarly, recent developments related to companies providing cloud API solutions have been tracked by the team at Persistence Market Research, which are available in the full report.
Historical Data Available for
US$ Mn for Value
Key Regions Covered
Key Countries Covered
Key Segments Covered
Key Companies Profiled
Available upon Request
Key Market Segments Covered
- SaaS Cloud APIs
- IaaS Cloud APIs
- PaaS Cloud APIs
- Cross-platform Cloud APIs
By Enterprise Size
- Cloud APIs for Small & Medium Enterprises (SMEs)
- Cloud APIs for Large Enterprises
- Cloud APIs for BFSI
- Cloud APIs for IT & Telecom
- Cloud APIs for Education
- Cloud APIs for Media & Entertainment
- Cloud APIs for Manufacturing
- Cloud APIs for Healthcare
- North America
- Latin America
- East Asia
- South Asia & Pacific
- Middle East & Africa (MEA)
Key Questions Answered in Report
- How much is the market for cloud APIs valued at?
The global cloud API market is currently valued at US$ 1.3 Bn, and is expected to surge even faster over the coming years.
- At what rate (CAGR) has the market expanded over the past 5 years?
The cloud API market increased at a CAGR of 15.7% from 2016 to 2020, backed by rising digital transformation across the world.
- What is the outlook for the sales of cloud APIs through 2031?
The global market for cloud APIs is anticipated to surge at 19% CAGR during 2021-2031. This rapid growth is attributed to high demand for APIs to enable cloud infrastructure deployments across enterprises.
- Which are the most lucrative markets for cloud API providers?
As per Persistence Market Research’s projections, China, Japan, South Korea, India, Australia, and New Zealand are lucrative markets, with East Asia and South Asia & Pacific projected to hold 1/3 market share.
- Who are the prominent vendors providing cloud API solutions and services?
Top 5 vendors of cloud APIs are IBM Corporation, Oracle Corporation, Microsoft Corporation, SAP SE, and Adobe Inc., which together accounted for more than 50% share of global revenue in 2020.
- What is a key trend being observed in the cloud API landscape?
Introduction of full lifecycle management APIs so as to bring in standardization that ensures APIs are created in a way that makes them easy to manage at scale is a key trend gaining momentum in this space.
- What is the main factor driving demand for cloud APIs?
With cloud computing being one of the fastest-growing technologies, cloud APIs are gateways that provide indirect and direct cloud infrastructure and software services, thereby driving their demand.
- How is the market for cloud APIs shaping up in North America?
The market in North America is projected to surge at around 15% CAGR through 2031, and capture 1/5 share of the global market.
- Which are the leading markets for cloud APIs in Europe?
Germany and the U.K. are driving the industry in Europe, and together, are expected to hold close to 50% share of the market in the region.
- What market statistics of Korea and Japan are worth keeping in mind?
South Korea and Japan together will be a billion dollar market for cloud APIs by 2031, capturing around 55% share of the East Asia market.
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