Google Now a Major API Player with Closing of Apigee Deal

Under terms of the agreement, Apigee stockholders will receive $17.40 per share in cash, for a total value of approximately $625 million. 

Whenever anybody using an IT device or service touches a button to connect with the internet or a native application, an application programming interface is involved. In fact, APIs are the most common dots connected by applications, servers and the internet—and billions of times per day.

So in what's known as the new application economy, APIs are a kingpin component. Google knows how important this is in the web services business, so it made a key move last September to acquire San Jose, Calif.-based Apigee for $625 million. The deal was announced as closed Nov. 10.

Under terms of the agreement, Apigee stockholders will receive $17.40 per share in cash, for a total value of approximately $625 million.

Public Trading on Nasdaq Will Cease

As a result of the completed acquisition, Apigee's common stock will cease trading on the Nasdaq Global Select Market, the company said.

Apigee provides a platform for developing, managing and monetizing application programming interfaces, as well as predictive analytics to help developers gain insight into the use of their APIs, which are building blocks for developing software applications.

"Companies are moving beyond the traditional ways of communicating like phone calls and visits and instead are communicating programmatically through APIs," Diane Greene, senior vice president of Google's cloud business, said back in September.

"APIs allow the company's back-end services to talk to the mobile and web-based apps used by their customers and partners. Instead of the doctor phoning a prescription into the pharmacy, they can use an app that talks to the pharmacy through an API. Apigee easily enables this by providing a comprehensive API platform that supports secure, stable, multi-language, dev, test, publish and analytics capabilities."

New Era of Cloud Computing Based on APIs

Chet Kapoor, CEO of Apigee, agreed, noting that the industry has entered into a new era of cloud computing, where companies are running more and more business-critical applications in the cloud and even across multiple clouds.

"Google is the open cloud provider committed to delivering new software for not only hybrid-cloud environments, but also for the multi-cloud world." Kapoor said. "With their history of innovation in web and mobile technologies, we believe Google is the partner for companies embarking on a digital transformation. We look forward to being able to accelerate our mission to connect the world through APIs as part of the Google team."

Al Hilwa, an analyst with IDC, told eWEEK the acquisition is a significant move Google is making in its enterprise cloud efforts.

"APIs are at the heart of how mobile apps interact with back-end systems and how modern microservices are constructed," Hilwa said. "Scaling and securing APIs is becoming an essential capability in new applications. We should expect Apigee to become an important new ingredient in Google's Cloud Platform and a competitive lever in the API wars between cloud providers."

Apigee has hundreds of customers, including brand names such as Walgreens, AT&T, Bechtel, Burberry and First Data. Walgreens, for instance, uses Apigee to manage the APIs that developers use to build apps for the Walgreens ecosystem—including the Photo Prints API and the Prescription API, both of which power mobile applications.

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Chris Preimesberger

Chris Preimesberger

Chris Preimesberger is Editor of Features & Analysis at eWEEK, responsible in large part for the publication's coverage areas. In his 12 years and more than 3,900 stories at eWEEK, he has...