API Consumption Management report highlights

Lunar.Dev recently announced the release of its inaugural report, "The 2024 State of API Consumption Management." This report focuses on API consumption management and includes an in-depth analysis of current trends, challenges, and strategies involving over 200 companies in managing third-party APIs.

As companies increasingly use and rely on diverse external APIs and AI APIs for various organizational functions, understanding API consumption has become a business necessity. The report provides insights and guidance for refining third-party API governance and management strategies, examining the entire API journey.

The findings reveal that managing the volume and diversity of APIs is a significant challenge for organizations, consuming considerable time and necessitating enhanced visibility. Moreover, the complexity of maintaining third-party APIs often leads to security risks, reduced performance, and increased operational costs, highlighting the need for specialized tools.

2024 State of API Consumption Management report key findings

Results indicate that organizations fail to prioritize strategic and proactive management of their third-party APIs, and lack the appropriate tools to do so. As a result, too much time and effort are hidden in the everyday work of developers.

Additionally, the complexity of maintaining third-party APIs often leads to security risks, hindered performance, and higher operational costs, underscoring the need for a dedicated robust tool.

• 88% of companies spend weekly resources on fixing API issues.
• 62% of companies do not prioritize API maintenance, leading to security and performance risks.
• 57% of engineering teams struggle with scaling their API usage effectively.
• 36% of companies allocate more effort towards troubleshooting API issues than developing new features.
• 83% of companies report monitoring as their primary method for troubleshooting API issues, yet only 38% use advanced techniques like rate limiting or queue management.
• 42% of respondents cited cost-effectiveness as the main advantage of optimizing API usage.
   

Prominent challenges when it comes to scaling API consumption

The report highlights several crucial insights

• 57% of Engineering Teams Struggle with Scaling API Usage: Majority of engineering teams reported lacking the flexibility to scale their third-party API consumption as needed, as well as the lack of performance stability under varying loads identified as a significant barrier.
• 88% of Companies Spend Resources on Fixing API Consumption Issues Every Week: Majority of respondents reported experiencing third-party API issues that require weekly attention, 36% of companies allocated more effort towards troubleshooting API issues than developing new features.
• 62% of Companies Are Neglecting API Maintenance: 62% of companies consider the maintenance and optimization of their API integrations a moderate priority or lower, exposing them to risks including security risks, bloated API rates and product performance issues.
• 83% of Companies Reported Monitoring as a top method to troubleshoot API issues,while only 38% of respondents use methods such as rate limiting or queue management techniques and even a lower percentage (>13%) use error handling and retry logic, which are crucial for making API interactions more reliable and robust.
• When asked about the primary advantages of optimization, 42% of respondents cited cost-effectiveness as the main advantage.
   

How companies deal with rate limits or exceeding usage of third-party API

Expert insights

Eyal Solomon, the CEO and Co-Founder of Lunar.dev, shared: "Historically, companies built custom solutions in-house to manage interactions with external APIs, a complex and resource-intensive task. API Consumption Management represents a new technological concept that recognizes the unique needs of services interacting with uncontrolled external APIs. These needs include orchestration of complex external API calls, resiliency for external API failures, and potentially stricter security measures due to the inherent risks associated with external providers."

Iddo Gino, founder of RapidAPI, Developer Tools Advisor and Investor added: "By using APIs companies can innovate faster and narrow their focus to core business logic. It’s clear that developers today rely heavily on APIs - and with those benefits come challenges. The survey clearly shows that as API consumption scales - cost, performance, security and reliability become hard to manage. It is clear new components are required to navigate the API consumption jungle."

Recommendations

The results indicate that organizations aren’t prioritizing the strategic proactive maintenance and management of their APIs but rather rely on a more reactive approach. Moreover companies seem to lack the appropriate tools to do so. As a result, too much time and effort are hidden in the everyday work of developers, with 36% of companies claiming they spend more time troubleshooting APIs than developing new features.

Prioritizing maintenance and optimization of existing third-party API integrations

Based on the findings, Lunar.dev offers several key recommendations for scaling companies:

• Streamline monitoring and maintenance, with holistic solution: To reduce time spent fixing API integrations, organizations must develop a comprehensive egress API consumption strategy, mirroring the existing inbound API security practices. Hence, consider investing in egress management tools to reduce costs.
• Once and for every end-point: Evaluate and implement tactics for optimizing API usage like caching, client-side rate limiting, and circuit breaker implementations for existing and future integrations with API Consumption tools.
• Continuously address major problems with minimal effort, focusing on caching, concurrency, API request routing, and rate limiting for cost-effectiveness and scalability.
   

Top concern related to caching, throttling, and delayed queues for managing third-party APIs