April 18, 2013
Co-authored with Eve Maler
Yesterday Intel set off of a flurry of tweets and news stories when it announced it had acquired Mashery. For those who aren’t familiar with Mashery, it is one of the earliest (and largest) vendors in the emerging API management space. Companies use API management platforms to secure and expose their APIs for public consumption. They are an important part of establishing a corporate platform and building a developer ecosystem around your business processes.
Intel’s acquisition really didn’t surprise us; the company already had an existing investment in working with Mashery, and was reselling it along with the Intel Expressway Service Gateway. The current integration featured Mashery front-ending the integration as a developer portal and for provisioning of developer licenses, while the Intel Expressway Service Gateway handled the operational aspect of API traffic routing and access management. We expect an immediate tightening of the existing integration, and for Intel sales reps to expand their pitch to offer API management capabilities in the cloud — a capability that was more difficult with Intel’s current product (which is delivered as a hardware-based appliance or a virtual appliance).
We’re intrigued by this acquisition, because there’s a larger benefit for Intel here than accretive revenue — although it’s not clear if Intel management realizes it yet. Most API management products give the producers of public APIs deep insight into who is using their APIs through analytics and reporting capabilities. As a multitenant SaaS-based integration, Mashery does the same for developers who are consuming APIs. In a sense, Mashery is on the verge of becoming an API exchange in addition to being a management platform. If Intel can push its new product to the point where network effects kick in, it has the foundation of an entirely new developer strategy. It would make sense to add on forge capabilities, community tools, and application life-cycle management facilities as well. The benefits of a developer program built around building modern applications could easily accrue to other Intel initiatives — like Tizen.
Intel’s acquisition is also a wakeup call to other large hardware companies and PC makers struggling to maintain relevance with developers. Yes, there will always be a group of developers that work close to the metal and care about power consumption, compiler performance, and raw speed. But there’s an ever-expanding group that cares more about service accessibility and composability — that works in languages and frameworks that isolate hardware specifics. IBM, Oracle, Dell, SAP, and HP all need to connect their existing developer programs to this expanding group of “modern application” developers as the action shifts to integrating systems of engagement with systems of record and operation. IBM is already well underway with its Cast Iron Live Web API Services product, but we expect this acquisition to act as a wakeup call to other firms — once they understand it’s more than just a simple market entry play.
If you’re a Forrester client, check out our evaluations of API management products from both Mashery and Intel in our recent Forrester Wave™. Given the timing of the Wave, we ended up assessing Intel’s and Mashery’s solutions separately, although they’d already begun to partner. What we saw in that partnership looked very promising. This acquisition is a big concrete step towards the consolidation of SOA-native and Web-native API solutions that our research predicted, but we don’t expect it to be the last.