Publishers Enter the API Era

The tech world is obsessed with platforms. Facebook and Twitter have grown, in large part, thanks to opening up to outside developers. More companies are doing so in the form of application programming interfaces, which allow data to be easily manipulated by others. Foursquare and Spotify are just two recent examples of Internet services opening up their data to others.

Now publishers want in on the action. A handful of news publishers are looking at their vast trove of content as valuable data that developers can use to hack into something new. These efforts at opening APIs, while early, are being done with the hope that someday, new revenue streams will present themselves.

The New York Times now publishes upwards of 16 APIs, having launched its first back in 2007. The Guardian provides data-related APIs, in addition to ones that surfaces over 10 years of editorial content. Even USA Today is moving into content APIs, holding a hackathon in December at its Virginia headquarters that was won by a developer who used the paper’s census data to construct a mobile game in which users would guess the right census numbers.

The New York Times APIs give developers access to movie reviews, event listings and articles. The Times has held numerous “hack days” where developers are invited to cobble together creations using data from The New York Times APIs, complete with food, beer and prizes.

During the last hack day in December, flixlinQ was awarded a prize for the best use of a New York Times API. A group of four developers used the Movie Review API, the Events API for movie listings, and the Comments API to further rate movies. All of the Times information was mashed up with the pixlinQ API that enables mobile image searching, and the final product allowed users to take a picture of a movie poster or billboard in order to see information about the movie and when it would be playing.

All this activity is a nice way to build a bridge with developers, who probably don’t think of old-school companies like newspapers as their first source for data to build into apps. Right now, though, it’s unclear whether the approach will lead to a difference in the bottom lines for the publishers.

“Originally the goal was to open up new revenue streams while encouraging innovation in-house,” said Marc Frons, chief technology officer of The New York Times. “Those goals still hold, but for us it hasn’t been a major source of revenue yet. Whether or not it will ever be a significant revenue stream for us is hard to say.”

It’s not impossible for publishers to turn their content API into revenue streams. Hoovers, for example, licenses access to its business information through an API. Bloomberg currently offers some market data for free from its Open Market Data Initiative, too.

Yet general news providers don’t have as specialized data. The Guardian, like the Times and USA Today, doesn’t generate significant revenues from its APIs, according to product manager Sharath Bulusu. (Products of its own hack days include Guardian Tag Explorer, which taps into the publisher’s API to visually represent the most common themes in its coverage for any given moment.) The most value the company itself has extracted from its API to date has been its acceleration of the in-house development process, enabling it to bring content to new platforms, such as Facebook or the iPad, within weeks, instead of months, said Bulusu. However, he expects that to change.

“In the next year, we want to switch gears and see how we can monetize the activity around our API, whether that’s through ads, further developing partnerships, or other means,” he said.

The Guardian has a three-tiered access model to its content API. Developers looking for story headlines and meta-data alone can get that information immediately and with no direct relationship with the publisher. Meanwhile, those requiring story content must obtain an API key and agree to The Guardian appending MPU display ads to the end of each story. The majority of that inventory has been filled with house ads to date, which provides value to the company but not necessarily direct revenue.

But the third tier, which provides unlimited access to The Guardian’s content in its entirety, is reserved for partners with which the publisher has a value exchange or commercial relationship. According to Bulusu, this is where it sees the most potential.

“There are plenty of people all over the world that would like to have access to our content, but we don’t have enough people to go and talk to all of them,” he said. “This helps us scale and has opened us up to a set of large partners we wouldn’t otherwise have had the time and energy to go after.”

According to Frons, that’s an issue that continues to hold back the New York Times’s ability to monetize its own API. Like The Guardian, access to its content is initially free, but it will begin to charge if it sees an opportunity to do so. While access to its data is seamless and automated, discussions around compensation are not.

“Nobody’s going to get rich off just creating an API — a lot of it depends on what you have to offer to begin with,” Frons said. “At the same time, I think there’s no going back from it. If you have content on the Internet, APIs are the best way to provide access to it.”