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The third edition of Mashup Camp was, as usual, free to attendees through the sponsorship of big and not-so-big software and web companies. Those companies don’t support Mashup Camp just because it’s a nice thing. They’re not just trying to get in good with cutting-edge developers. No they are doing it because there’s money to be made in mashups.
Let’s look at some of the most interesting ways companies are making money (or hoping to) in the mashup economy: elastic computing, aggregated data access, mashup development tools, and mashups themselves.
By providing so-called elastic data storage and virtual hardware, Amazon’s Web Services and efforts built on top of it may represent one of the best ways of making money off of people’s desire to assemble apps instead of building them from scratch. Mashup developers could always buy and administer their own hardware, but the philosophy of mashups is based on putting together apps out of pieces other people provide. Elastic computing services make storage and processing power into yet another off-the-shelf component.
Amazon’s S3 data storage service provides a cheap and scalable online hard drive. Not only does it scale up, in case your video mashup suddenly attracts a bunch of users with long videos, it also scales down, in case those video users migrate to a different service. You’re not stuck paying for hard drive space you no longer need. You pay $.15 per gigabyte per month for storage and $.20 per gigabyte of data transfer.
Amazon’s Elastic Compute Cloud (EC2) offers on-demand processing power. Need to transcode the videos your video mashup users upload? Again, pay for just the computing power you need by adding and subtracting virtual machine instances.
Aggregated Data Access
Companies with valuable data like Dun & Bradstreet with its comprehensive business credit information and Bloomberg with its financial data feeds have long known how to make big bucks by selling access to their data via commercial feeds, APIs, and services around them. As mashup development on the open web becomes more popular, we’ll likely see companies with valuable data charge those who access it.
But you don’t have to have your own data to make money off of data access. Right now, there’s revenue to be had in acting as a one-stop shop for mashup developers, essentially sticking yourself right between data providers and data consumers.
ProgrammableWeb, the favorite community website of mashup developers, provides comprehensive listings of APIs available on the web and includes forums where developers can discuss how to best use them. ProgrammableWeb earns money from direct sponsorships on the website.
StrikeIron aims at the enterprise and commercial software development markets by aggregating access to popular data sources and APIs in the form of a web services marketplace. Their September 2006 launch of a “super data pack” suggests how aggregating data access represents a potentially lucrative trend in the mashup economy.
Mashup Development Tools
Sophisticated developers might already have all they need to build a mashup–a hosted LAMP stack and text editor, a quick browse of APIs at ProgrammableWeb, a few thousand lines of PHP code, and voila!–the next HousingMaps. But as mashup making mojo filters out to the broader web population, there’s a need for both easier-to-use and more full-featured tools for composing applications out of little pieces found on the web.
One of my favorite demos at Mashup Camp (and the one that got my wooden nickel) was OpenKapow, a free tool that lets you make an RSS feed, HTML component, or REST-style API out of whatever website has the data or interactivity you need. Where’s the money, if it’s free?
In their enterprise software: a mashup server that a company hosts itself, and thus gives its employees the ability to integrate existing applications and new capabilities into so-called composite applications specially tuned to the needs of individual employees or small groups. It’s a great idea to offer a free version of your software to the web community, because people playing with it might just want to bring it into their employers’ IT setups.
IBM also has its sights on the mashup market, with QEDWiki, a prototype browser-based development tool that allows end users to build their own composite applications in a wiki-type environment. Proto Software offers a similar tool, but as a desktop application instead of in the browser.
You might also be familiar with some of the many do-it-yourself application development tools on the web: Coghead, Ning, and DabbleDB represent just three of the more well-known ones. All of these offerings aim at the end user programming market that may converge at some point with mashup development.
And Even Mashups Themselves
Can you make money off of mashups themselves? Sure–because in the end, a mashup is just another website or web app, so the same rules for making what you’ve built into a business mostly apply.
On the back end, you’ll need to worry about what your data and API providers think of what you’re doing so that they don’t cut you off. But on the front end, you have all the same ways available as before to make money on the web: advertising, affiliate revenue, subscription services, and so forth. The Hype Machine, the best mashup of Mashup Camp 3, for example, uses both advertising and affiliate sales revenue to make money.
But the vast majority of websites don’t turn a profit for their creators, and this may hold true for most mashups too. Looks like if you want to make money on mashups, you might want to become what the Mashup Camp folks call a “mashup enabler”–the service and tool providers that make mashups possible.