What Is a Third-Party API, and Why Should You Use One for Your App?

Learn what a third-party API is, how it works, its security benefits, and how using one in your application will save your business both time and money.

third-party api

Have you ever tried building a wooden deck by yourself?

A deck is the sum of its components: footing, posts, beams, joists, railings, stairs, and fasteners. You can either choose to build each component yourself or buy the generic ones from your local hardware store.

Building a software product is similar. You can either build every feature and function internally or focus your efforts on building more unique features while relying on third-party API providers to establish the actual infrastructure.

What is a third-party API?

Third-party application programming interfaces (APIs) help two systems talk to each other by stating the rules of communication between them. You make a request based on the defined rules and provide your API key, and the system then responds to your request.

Your API key is a unique ID assigned to you when you sign up to use a third-party API. You’ll see third-party APIs in use on all types of web and mobile applications. For example, Twitter uses Google’s API.

When you create a new account, Twitter’s home page shows a ‘sign up with Google’ option. When you click the button, Twitter uses Google’s API to fetch your email address, name, and similar information to set up a profile for you. In this case, Google Sign-In acts as a third-party API. Twitter’s web or mobile app makes the request based on protocols defined by Google, and Google responds with the requested information.

Google Maps is another commonly used third-party API. There are more than 5 million mobile and web apps that use it to enable custom mapping features. Other commonly used third-party APIs include YouTube API to support YouTube videos on your website and Facebook API and Twitter API for user authentication. In fact, you’d be hard pressed to find any app that doesn’t use at least one third-party API. So, how exactly did third-party APIs become so common? 

Third-party API integration benefits

Third-party APIs get you pre-built features and functionalities, so you don’t have to spend weeks or months building something that’s already available.

One of the biggest responsibilities of a product manager is to decide which feature to build next. In most cases, you have multiple features lined up, and you must get all stakeholders onboard and choose one for the developer team to build. Unless you are leading multiple teams working on multiple features simultaneously, you have to make some hard choices and deprioritize some features. When prioritizing a feature, you have to consider user suggestions and feedback, your own research, and competing products.

Planning and prioritizing initiatives is one of the top challenges for product managers. This is because resources are limited, and every feature you ship has to increase user engagement and adoption by improving the product. 

By using a third-party API to build new features and functionalities, you can use your resources more efficiently and focus your efforts in the right direction. For example, instead of building bi-directional email capabilities into your CRM from scratch, you can use the Nylas Email API and easily stand up a customizable, pre-built feature for your next release. That will save you weeks of development, testing, and deployment, and your developers can refocus on building other differentiating features.

Third-party APIs are more secure by nature

Third-party API security is a big concern for product managers. That’s because APIs are a common attack vector for hackers. According to Salt Security, 2.1% of API traffic was malicious in Q3 ‘22, representing a 117% increase in attacks from the previous year.

While this rise in attacks is concerning, you have to consider that this data is for all types of APIs. The study by Salt Security mostly talks about first-party APIs used internally to make two systems talk to each other within a company. Since third-party APIs are built for commercial use, the companies that develop them strongly emphasize security. A security breach can result in damage to their reputation as well as lawsuits.

Third-party APIs use developer keys for increased security. The developer must apply to get a key that’s unique to them. Then, they use that key to access the API’s functionality. Any developer using the key becomes known to the API provider, and any attack or malicious activity coming from the developer side can then be stopped by revoking the key. This way, third-party API providers protect their systems and ensure uninterrupted and safe usability. They also protect users through advanced encryption techniques.

Regulatory compliance is a good indicator of how seriously an API provider takes security. If you have security concerns, look for SOC 1 TYPE I and SOC 2 Type II compliances, along with other specialist regulatory compliances such as GDPR, HIPAA, and FINRA. These compliances show that the third-party API provider uses advanced techniques to protect data and that their techniques are reviewed and verified by the relevant governing bodies.

Third-party APIs save money in the short term and pay for themselves over time

Building your own infrastructure will cost you at the time of development and be followed by some upkeep costs. In most cases, the upkeep costs are less than what you’d pay for a monthly subscription to a third-party API. However, building your own technology means months, if not years, of development. Using an API means going to market quickly and getting your product in front of users before the competition.

Let’s also not forget the developer experience and the incurring costs for the servers needed to test and eventually run your application. The median salary of a developer is close to $75k in the U.S. Add to that the costs of the infrastructure needed to develop, test, deploy, and maintain new features, and you are looking at tens of thousands of dollars for smaller features and hundreds of thousands of dollars for more complex features in terms of development costs. 

Using a third-party API saves all of those costs, as you just sign up for a package and introduce the new feature to your app with less than a week’s worth of customization and development.

Most APIs also have scalable costs. For instance, if your app has many users and the API is used frequently, you have to pay a higher cost. Even if you don’t use one with a scalable plan, the new features and functionalities you’re able to quickly and securely build will help you get the most value out of the money you spend on the API. 

The business outcomes and success of new features and functionalities are measured through product adoption and user engagement. The same is true when it comes to measuring the success of the features and capabilities you acquire through third-party APIs. If your third-party APIs help you increase product adoption and user engagement, the annual costs you incur will be worth the investment. 

The unmistakable value of third-party APIs

If you’re looking to go to market faster, beat out your competition, and save on internal costs such as money, time, and developer resources, third-party APIs are undoubtedly the way to go. They allow you to leverage the technology, expertise, and resources of others to hone in on your product roadmap more productively and efficiently. Are you convinced of the power and utility of third-party APIs yet? If so, explore how Nylas’ Email, Calendar, and Contacts APIs can help launch your business to the next level.

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