What Are APIs? How They Work + Popular Uses

by Anna Khrupa on Jan 12, 2022

API is a term you can often hear even when you don’t work with software development. Popular browsers, mobile apps, and other software products use the API technology for all kinds of purposes. But what exactly do APIs do and how can they be used in your next project? Here is your quick guide to APIs.

The definition of an API

An API, or an Application Programming Interface, is a fragment of code that allows two software products to exchange data. It also provides a software product with an opportunity to access external operating systems, software components, or microservices.

Moreover, APIs contain the terms and requirements of these exchanges and interactions. This is why an API can also be defined as a set of rules that describes the way in which different devices and applications can communicate.

How does an API work?

There are several ways to explain how APIs work, and the easiest one does not even need any technical terms. A common example of APIs often used to describe their essence is a restaurant analogy.

A customer describes the order to the waiter, who then gets the information across to the kitchen staff. The kitchen staff performs the necessary operations, and when the order is ready, the waiter delivers the result to the writer.

This is a very simplistic way to explain how APIs work. In this scenario, the customer is the end user. The kitchen staff is the server that is responsible for fulfilling the user’s request. And the waiter is the API whose job is to communicate the requests to and from the server.

So, the way an API works is pretty straightforward. The client, or, rather, the requesting application, sends the request to the server. If the server can fulfill the request, the result will be delivered via the API to the client. If the request cannot be fulfilled — for example, when the client wants to retrieve the information they are not authorized to access — the API will return with an error message.

Benefits of using APIs

An API is not a brand new concept, and it wouldn’t have stayed at the forefront of the software industry if it wasn’t for its many benefits. Here are the biggest advantages of using the API technology in your software development enterprise:

Faster development. Working with APIs allows software developers to move away from the monolithic software architecture in favor of the microservices approach. With each component of the product being developed independently, and with less time spent on code reviews and testing, the product’s time-to-market can see a big improvement.
Lower development costs. APIs are built with reusability in mind. A single API can be used for multiple purposes within a single organization or even across different organizations with only minor tweaks. The cost of introducing those tweaks cannot even be compared to the cost of developing a software solution from scratch.
Endless functionality. APIs already provide diverse functionality for all kinds of uses, and it only continues to get more comprehensive. There are countless software products that rely on APIs for every aspect of their performance. For example, a food delivery app can use APIs to monitor product stock, prices, and order status, help the driver select the shortest route, send customer notifications when their order leaves the restaurant, and calculate delivery costs based on the customer’s location, driver availability, weather conditions, and peak hours.
Development integrity. A major benefit of the API technology is that it allows for the frontend and the backend parts of the application to be developed simultaneously. As a result, the developers working on the product can be better informed about the specifics and the progress of the development process, which allows them to achieve better product integrity.
Increased security. When you exchange information with a third-party server the old-fashioned way, there is always a risk of a data breach. However, when using an API, you grant access to the bare minimum of your data to the third-party application. That way, the possibility of a data breach or an unauthorized access to the backend of your application is minimized.
Source of revenue. API can be successfully used to meet the goals of your own business. But thousands of companies also use APIs to generate revenue from third parties using their API products. Facebook, Amazon, and Etsy are just some of the biggest names that are using APIs as an additional revenue stream. And although your company may not have reached the likes of Facebook and Amazon in size yet, sometimes all it takes is a strong idea and a reliable web development partner.
User satisfaction. If your software product is intended to be seen and used by a lot of people, let alone generate revenue, then user satisfaction should be one of your concerns. And API technology definitely helps you increase it. With access to all kinds of data available at a single request, your users can get everything they need from a single product.

Types of APIs

There are several approaches to categorizing APIs, and they are not mutually exclusive. They simply use different aspects of APIs to categorize them into different groups. These are the two most popular groups of APIs and their corresponding types.

By availability

APIs are created with a purpose, and the purpose defines their availability. All APIs you encounter will likely fall under one of the following categories of availability:

Open. Open, or public APIs, are distributed and used on the internet without any restrictions. These terms are often used interchangeably, but they mean slightly different things: open APIs can be modified by anyone, while public APIs are typically used as they are.
Internal. This type of APIs is almost the exact opposite of open APIs. Internal APIs are developed exclusively for in-house use. Because of this, there are fewer concerns over data security. Moreover, little to no adjustments are needed because the developers already know how their in-house software operates.
Private. Like an internal API, a private API is also usually developed for use within a single company. However, unlike an internal API, which is usually protected by firewalls and not available on the internet outside of the company perimeter, a private API can be accessed by remote employees or even by customers who, for example, purchased a software product from a company that comes with an API in a bundle.

By structure

APIs can be built using different technologies. As a result, they will have a different architecture and will serve different purposes. Here are the three most common API structure types.

REST. REST stands for Representational State Transfer and it’s a stateless type of API structure, meaning that it doesn’t keep any information on its physical disc and depends on third-party storage for handling the data. This is the ideal structure type for APIs that are expected to perform under a heavy load.
SOAP. SOAP, or Simple Object Access Protocol, is an API structure that can use any data transfer protocol except for HTTP. On one hand, it gives the developer some flexibility in implementing the tasks. On the other hand, it often makes the code heavier, which can increase the loading time.
JSON/XML RPC. RPC, which stands for Remote Procedure Call, is a data transmission protocol that can work either with JSON or XML format. The biggest advantage of this structure is the support of batch processes. It means that an API with this structure will be able to execute several operations in one call.

The most popular API uses

Even as a regular internet user, you likely encounter APIs on a daily basis, often without specifically knowing that it’s an API. Modern APIs provide nearly unlimited opportunities both to their developers and the end-users. Here are the five examples of APIs that millions of users interact with day in and day out:

Ecommerce payments. When you are shopping on an ecommerce website and want to pay for your purchase using, for example, PayPal, the ecommerce website does not access your PayPal account directly. Instead, it uses the PayPal API to make the transaction secure for every party involved.
Logging into websites. Many popular sites require you to log into them to use the services in full — for example, to continue reading the article or to save the file you’ve been editing. If you don’t feel like going through the signup process, you can usually log into these sites using your third-party website accounts, such as Facebook or Google, and this is done via API technology.
Twitter bots. A Twitter bot can look like pure entertainment at first glance — we’ve all seen those funny, quirky, or downright useless Twitter bots. But a Twitter bot can actually be both useful and complex. For example, you can ask a bot to send a message to every new follower or tweet every time anything specific happens. This is all possible thanks to the Twitter API.
Travel bookings. When you are using websites like Skyscanner for flights or Kayak for hotels, these websites process prices from hundreds of hotel or airline sites to provide you with the cheapest options. The only way it can be done so quickly is via the API technology. And here it also works in reverse: when you book a flight or a hotel room, the service uses an API to send a confirmation to the airline or hotel.
Weather forecast. In recent years, you probably don’t visit weather websites too often. You either look at your smartphone’s weather widget or app, or Google “Your city + weather” and check the result directly on the results page. Both of these solutions are powered by APIs.

APIs can unlock more opportunities for your business, give your software product the exposure it needs, and provide new ways to reach out to your customers. All you need is a clear idea of what you are trying to accomplish and the help of a trusted development partner!