API as a service: what it is and why it may matter to your business

APIs underpin pretty much every digital service on the planet these days. And even above the planet, in fact, with Tyk’s API management solution helping satellites navigate their way through space even as you read this. As the API landscape evolves, so too do the services associated with creating, securing and maintaining APIs. This is where API as a service (AaaS) comes in.

What is an API as a service?

API as a service companies aim to make it easier and less time-intensive for businesses to implement API solutions. They do so by providing cloud-based platforms and tools that developers can use to design, secure, deploy and monitor APIs far more easily than if they were to carry out such activities in-house. The business ends up needing to do little more than work out how to integrate APIs with their own software architecture. Hosting, management, maintenance and even security, versioning and scaling become the concern of API as a service companies instead.

The degree to which responsibility for these functions is abstracted away depends on which API as a service example you consider. Some providers are going all out and offering an API as a premium service model, with everything from automated endpoint generation, no-code API builders, automated documentation creation and pre-built APIs all just a few clicks away.

The API as a service business model means that organisations can reduce the complexity and cost of their API program while getting products to market faster. We’ll explore these benefits – and others – in a moment, but let’s first take a quick look at how we got from APIs to the emerging API platform as a service model.

The evolution from APIs to API services

First came APIs. Then came the magnificent open source API gateway concept. Various API gateway as a service models and API management solutions followed, making it ever easier to manage APIs, baking in security policies and delivering reusable code through handy templates and a user-friendly ‘point and click’ experience.

API services are now branching in two distinct directions, both of which are shaping the future of digital technology by presenting significant time and cost efficiencies. The first is platform engineering, which – when implemented well, using a platform as product approach – delivers automation, reusability and efficiency at an impressive scale. The second is AaaS.

API services vs API microservices

Ok, so there were about a thousand more twists, turns, developments and nuances that we could have added to the potted history above, but our key focus today is on the API as a service concept. Microservices have played a role in the emergence of AaaS too.

Containerised microservices have enabled organisations to move away from monoliths, swapping silos for more flexible modification potential, reusability and easier troubleshooting and debugging. APIs serve as the natural glue that holds everything together, enabling swift and seamless communication between different services, particularly when you add an API gateway for microservices into the mix.

Why is API as a service important?

API as a service is important for a range of reasons. It delivers a host of practical benefits (see below) and is also significant in terms of the API industry’s direction of travel. Budgets are stretched pretty thin across many verticals these days, with developers under pressure to do more with less. Super-efficient services that can save them time and money, from no-code GraphQL solutions to buying in an API integration platform as a service, means that developers can continue to achieve, innovate and get products to market faster, despite shrinking resources and ever-increasing workloads.

What are the benefits?

For businesses that buy into the AaaS model, there are plenty of rewards to be reaped. Let’s dive into some of the headline benefits.

Scalability and flexibility

Being able to scale up – and down – swiftly and efficiently is key to business success in the modern marketplace. This is a major benefit of API as a service, where the cloud-native nature of the service makes it easy to respond to shifts in customer demand by scaling your services rapidly. When times are lean, you can do the reverse. This flexible approach to scaling can deliver notable cost benefits in both instances.


Does your business have limitless time and resources? If not, the efficiencies that API as a service companies can deliver are likely to appeal. By going down the AaaS route, you can use the resources you’ve got efficiently, buying in the elements you need without having to invest in a whole heap of hardware, software and other resources that the cloud and AaaS have made unnecessary.


Not having to purchase a load of hardware and software delivers a welcome cost saving. As does freeing up developer time that would otherwise be poured into developing your APIs from scratch in-house.

The fact that many API as a service companies charge for their services using subscription pricing models, or usage-based pricing, means that you can keep a close eye on costs and budget for precisely what you need. Another strong argument in favour of the AaaS approach.

Faster time to market

Freeing up developer time means you can focus your team on innovation, supporting the speedy creation of new products and features. By taking the time-consuming, complicated elements out of achieving what you need to with APIs, AaaS enables you to race to market ahead of your competitors and enjoy the profits that roll in thanks to you doing so.


Building an enormous API empire can be quite an undertaking, whether you’re a new business starting from scratch or an older organisation with a heap of legacy spaghetti to sort through. API as a service offers a simple alternative – one where the headaches associated with security and with ensuring that APIs meet regulatory compliance obligations all sit on the AaaS company’s To Do List instead of your own.

The degree of simplicity that this affords, combined with the lack of technical debt, means that there are plenty of reasons to take a long, hard look at precisely how an API as a service approach could benefit your business.

Common use cases for API as a service

The use cases for the API as a service business model are many and varied. As we’ve seen above, AaaS has the potential to benefit any organisation that’s in need of simplified integration to get its products to market in an efficient and cost-effective manner. As such, use cases for AaaS encompass any business that is looking to innovate rapidly without incurring unnecessary technical debt – which in a competitive world could mean any organisation with vision, drive and a dynamic approach!

How to choose an API as a service provider

One of the benefits of Tyk is that we focus on providing user-friendly, intuitive functionality for all of our services and features. This is certainly something to look out for when you’re choosing an API as a service provider. Part of the reason for adopting the AaaS model is to achieve greater simplicity, so be wary of providers whose offerings feel clunky and unintuitive from the outset.

Look for clear pricing when choosing between API as a service companies, too. What will happen to your bills if you scale up rapidly? And if you scale down, how long will you be locked in a higher tier for before your costs drop? Be sure to understand the pricing associated with a range of different scenarios, so that you know what’s on the horizon if and when demand for your services spikes – or drops.

It’s also worth focusing on how your AaaS provider sees the future. Increasingly, businesses are considering the overall API experience as key to their future – something broader than what we might traditionally think of API management as encompassing. If your AaaS provider is talking about API experiences, it’s a good sign of future focus.

We mentioned security and compliance above. These are key issues to grill potential AaaS providers on. After all, you are placing a huge amount of faith in them when you use their API solutions. You need to ensure that their products and services meet your own obligations when it comes to keeping data secure and regulators happy.

Finally, don’t forget about customer service. Here at Tyk, we’re known for our fabulously helpful and talented team, and we take pride in the fact that our customers can rely on us so resoundingly. When you use an AaaS company, you need to know that you’ll receive a similar level of support if you need it. Whether it’s an integration query or something more serious, knowing the company has your back can make all the difference. So be sure to choose an AaaS company that prioritises customer service.

As ever in our fast-paced digital world, there are plenty of trends and developments that will shape the technological future. API as a service is certainly one of those trends. Why not discover five other trends that are changing the way we think about API management and explore how they are likely to shift the digital landscape over the months and years ahead?