BBVA Innovation Edge. APIs (English) by Centro de Innovación BBVA

MARCH 2015

also in this issue Trending issues Technology trends

HELLO THERE,

DIGITAL! WILL YOU MAKE ME API? <!The digital economy & APIs> <!APIs help companies to address change> <!The business benefits of APIs>

The digital economy & APIs Software is becoming â&#x20AC;&#x153;the businessâ&#x20AC;? and, as a result, businesses are becoming programmable. To gain competitive advantage, leading businesses are becoming increasingly digital. In other words, everyone seems to be obsessing with APIs, the building blocks of the digital economy.

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â&#x20AC;&#x153;Software is Eating the Worldâ&#x20AC;? (Marc Andreessen, 2011) Operating a modern business, by in large, has become a software affair; it allows companies to better create, deliver, and capture value from their business models. In the near future, software will enable organizations to radically improve the way they operate. While softwar e used to be e xclusive to inherently digital busine sses or Internet er a businesses s uch as Amazon and S alesforce.com , it now permeates alm ost every indu stry and product

Increasingly, all businesses are becoming soft ware-driven. As a result: Internal proce sses are starting to be automated, the first step t o becoming optimized.

Ancillary IT functions are gaining new efficiencies.

Processes tha t used to be sl ow are now takin g place in real or near real tim e.

The workforce is now fully mobility-enab led.

An increasing ly large amou nt of data is becom ing available f or making busin ess decisions, and data quality is improving ste adily.

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APIs: what are they?

APIs, at their core, provide two main types of benefit:

“APIs are the building blocks of the digital economy. They make existing capabilities fungible, so that it is possible to use them in new ways, quickly and easily, thereby spurring innovation and new value creation.” (Laura Merling, AT&T).

■■ They

According to a leading subject matter expert, an API (Application Programming Interface) at its most basic level, allows your product or service to talk to other products or services. In this way, an API allows you to open up data and functionality to other developers, to other businesses or even between departments and locations within your company. It is increasingly the way in which companies exchange data, services and complex resources, both internally, externally with partners, and openly with the public.

restructure and organize internal systems to support innovative new projects in a uniform manner—reducing maintenance costs and increasing agility.

■■ They

provide new opportunities to generate new ways to reach customers, generate revenue and build partnerships.

In other words, they create programmable businesses. Specifically, they execute software strategies structured around extensive internal and external interfaces. These interfaces (APIs) are the key to unlocking the power of the software itself. As we see, in the near future, all businesses are going to be programmable. At its core, the digital economy is powered by APIs. As such, companies that manage APIs well will enjoy differentiation and be competitive; and companies that don’t are simply asking themselves to be taken out of the digital economy altogether. Source: 3scale and Kin Lane

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Some recent newsâ&#x20AC;Ś The management of APIs drew much attention throughout 2014, and continues to do so this year. Actually, if we look at the intense pace of news generated about this subject, it seems that the business of managing APIs is not negligible..

Save Time with Easy Maps API Integration from Java and Python (January 7, 2015) The Google Maps API provides a rich set of web services that allow developers to integrate them into connected applications

Sony launches API for programming embedded applications on their devices (January 5, 2015) API LifeLog monitors your daily activity, and now it has a new interface with an open API, based on HTML5, which optimizes the user experience and visual

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Mother returns and opens its API to developers (January 5, 2015) The home automation kit Sense connects to your router and is paired with devices that detect nmovimientos and temperature. In February will open its API to developers to improve updates intelligent home appliance

Facebook Graph API V2.0 tools ease Dev Transition (December 29, 2014) Facebook recently made a new tool available to developers that it hopes will kickstart the migration from Graph API version 1 (v1) to Graph API version 2 (v2). The tool lets developers see how things will behave in the v2 environment before they actually make the switch and publish their updated app

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How the UKâ&#x20AC;&#x2122;s government is leading api security (December 29, 2014) As modern information exchange is relying more and more heavily on APIs, security for these web services is critical for ensuring proper identity authentication and for controling varying levels of API access. The United Kingdomâ&#x20AC;&#x2122;s government has become a well-known leader in carefully implementing these measures

Seldon aids data scientists with predictive API (December 23, 2014) A new open-source API, Seldon, wants to remove the demand on data scientists by making it easy to plug-in algorithms which can recommend content to customers, offer app personalisation, and other complicated-but-powerful features

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APIs help companies to address change More than ever, external realities are forcing companies to adapt; it’s not “if” your industry will get disrupted; it’s a matter of “when”. Today, APIs are helping companies adapt to both incremental and disruptive change.

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Disruptive changes are upon us Large corporations are currently experiencing many disruptive changes at different levels and at different areas of the business model, all at the same time. Change in productivity model: Industry Knowledge We are currently moving away from an industrial-based productivity model and we are moving towards a knowledge-based productivity model, where “knowing” is more important than “having.” In a sense, knowledge-based businesses capture most of their margins from “knowing things”; conversely, industrialbased businesses capture most of their margins from “having things”. This change in the productivity model has been much discussed and, in the end, it seems that EVERYONE wants to become a digital business. EVERYONE!

Change in technology paradigm: PCs Devices According to Gartner, “the Nexus of Forces (Social, Mobile, Cloud and Information) describes the convergence and mutual reinforcement of four interdependent trends: social interaction, mobility, cloud, and information. The forces combine to empower individuals as they interact with each other and their information through well-designed ubiquitous technology.” These “forces” are causing a major shift in the computing paradigm: we are moving away from PCs and moving towards devices (smartphones, tablets, wearables, etc.). Source: Gartner

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CUSTOMERS

MO BIL E

PARTNERS EMPLOYEES

THE DIGITAL ENTERPRISE

L A I C SO

A T A D G I B

CL OU D

Change in business models: Web Apps In the future, Apigee, the API management company, is projecting a world with over 1 trillion devices, each with several apps installed. In essence, these apps help businesses to deeply understand and build a meaningful relationship model; offer better delivery models (directly or through partners); and ultimately, create new value propositions, leading to new revenue growth. This change generally affects the customer-facing areas of the business model. And guess what? APIs enable this transition.

Change in business models: IT Platforms In traditional IT, computing resources are viewed as scarce and expensive; perhaps this is one of the reasons why IT projects are measured in years. Whereas Platforms, computing resources are viewed as abundant and cheap; interestingly, these projects are measured in weeks. The strength of the Platform model is that it allows companies to better manage people, time, and costs. This change generally affects the company-facing areas of the business model. Again, APIs are behind this as well. Source: Apigee

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APIs & the dynamic view of corporations A dynamic view of the corporation assumes that companies must constantly adapt to their environment to ensure their long-term survival and economic success. Generally speaking, corporations must have the capability to adapt to two types of change: ■■ Change which is characterized by long periods of slow, incremental change; and ■■ Short periods of rapid discontinuous or radical change. Given all the stuff that is going on right now, it’s pretty safe to say that we are in a prolonged period of rapid, disruptive change. In that regard, APIs offer technology enabled solutions to manage both types of change at different levels and in different parts of the business model. Source: Rene Rohrbeck, 3scale, and Apigee

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Today, APIs are at the heart of innovation IBM, in their recent global survey of C-level executives, discuss 3 themes that will most likely help organizations shape their futures. Not surprisingly, innovation was discussed. The study explains, “the intersection between the digital and physical is the leading edge of innovation. … As the digital infuses the physical, and vice versa, organizations are transforming the customer experience, … understanding and engaging the customer as an individual rather than as a category or market segment. For example, smart pills and smartphone heart monitors,

intelligent vehicles and crowd-sourced traffic routing, books that respond to a reader’s location and apps that enhance the in-store experience: the possibilities are enormous.” At the same time, companies are also facing rising customer expectations and decreasing tolerance. This means that both customer-facing and company-facing areas of the business model must become programmed to meet new challenges in the digital world. In other words, they have to be “API”. Source: IBM

Digital ambitions: CMOs want to put the components of a strong digital strategy in place TODAY Integration of crosschannel touchpoints Analytics to capture customer insights

Digitally enabled supply chain

87%

16% 83%

13%

Social networks to foster collaboration Workforce aligned to opportunities

3-5 YEARS

78%

20% 13% 11%

73% 69%

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The business benefits of APIs In the API world of today, innovations are currently focused on two main areas of the business model: the company-facing area and the customer-facing area. Letâ&#x20AC;&#x2122;s take a quick look at some the benefits that APIs have to offer to organizations.

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The company-facing benefits of APIs As previously mentioned, APIs restructure and organize internal systems to support innovative new projects in a uniform manner - reducing maintenance costs and increasing agility. Some benefits of internal consumption of APIs include: Source: 3scale and Apigee

Custom integrations are costly to establish and maintain, inhibiting change. An API allows greater experimentation and internal and external innovation.

New opportunities Controlled access to close partners and contractors

Improved change management

Reduced complexity

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In many cases, businesses need to work with external contractors for new functionality or distribution (such as in the rollout of a new iPhone app or syndicated content). With API-supported collaboration, both parties have a clearly defined foundation for partnership, reducing the security risk.

New opportunities Controlled access to close partners and contractors

Improved change management

Reduced complexity

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APIs can provide a common root so that transactions can flow from wherever they originate: mobile apps, integrations with clients, the clientâ&#x20AC;&#x2122;s website or physical devices. All mapped into unified internal systems.

New opportunities Controlled access to close partners and contractors

Improved change management

Reduced complexity

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Since user interfaces are added or changed frequently across a company, APIs provide a way to stabilize core transaction services, for a much more solid platform that enables rapid iteration at the edge.

New opportunities Controlled access to close partners and contractors

Improved change management

Reduced complexity

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Mobile

Enterprise without API Mobile applications for specific platforms, each with a separate code base and ad-hoc server back end. Enterprise with API In the backend, through the API, it is possible to program applications with third party data.

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Customer Integration

Enterprise without API One-to-one custom integrations at high cost, using rigid pointto-point integration technologies such as SOA. Enterprise with API Provision of different services through an API, allowing customers and partners to integrate them as a self-service adapted to their particular needs.

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Digital Distribution Channels

Enterprise without API Limited choice among automated advertising style channels and expensive, custom integrations with each partner. Limited opportunity to reach new audiences. Enterprise with API Provision of content and transactions via well-structured APIs, often with software development kits (SDKs) added to speed partner integration of the content or tansactions.

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Direct Access to Infrastructure

Enterprise without API High capacity infrastructure is accessible only internally within the company through restricted interfaces. Enterprise with API APIs are used to open up core infrastructure directly for use by outsiders, so it can be turned into a key business. Amazon has done this with its Elastic Compute Cloud and companies like Twilio do this with cloud communications.

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Internal Development

Enterprise without API Direct to database and backend systems applications across multiple departments, creating fragile interdependencies, security issues and slow-moving innovation. Enterprise with API Creating an API, you can separate the access to backend services and new applications, creating a development environment for apps more modular, flexible and better documented.

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The customer-facing benefits of APIs If the benefits of internal consumption of APIs wasn’t enough to convince you … wait, there’s more. There are also customer-facing benefits APIs, including the enablement of an organization to create powerful new external partnership, distribution and transaction channels.

Ultimately these changes mean organizations become platforms in the truest sense: providing their core value to customers and partners in the form these entities need it.

APIs can transform businesses into powerful platforms that support partners, customers and the wider world. The organizations that seize this opportunity are joining the API Economy. In so doing, these organizations: ■■ Enable

flexible APIs as a major channel into their business, enabling transactions to be driven from anywhere. ■■ Provide mobile, web and other client interfaces as a flexible layer of channels on top of this API. ■■ Allow customers to integrate directly to core systems, providing more value and creating a strong provider-customer relationship. ■■ Grow strong ecosystems of partners that repurpose, resell and re-bundle assets to reach new audiences that the original organization could never have reached alone.

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5 most common business use of APIs Mobile Enablement The backend API must be defined as the baseline platform for all of an organizationâ&#x20AC;&#x2122;s mobile applications. If organizations define the backend API as such, they create a stable abstraction layer between internal resources and a changing set of external applications. As a result, this architecture provides a stable backend baseline for multiple applications on different device types; fosters agility for the development of new applications; and creates a natural boundary to the edge of the organization, which is critical when the organization partners with external design or development agencies.

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5 most common business use of APIs Customer and Partner Ecosystem Growth Here, we’re talking about building a platform. A platform essentially creates an arena in which others can create value, either directly for themselves (customer platforms typically) or for others (partner platforms). There are three broad audiences for which an organization can open itself up as a platform: customers, reseller partners, and integrators & software partners.

Platform means … ■■ Exposing key sets of content or transactional capability in a programmable way such that customers or third par-

ties can create long running integrations on top of the functionality. ■■ Providing support for these integrations and related business engagements. ■■ Helping to promote particular partner integrations.

Business Benefits of Platforms ■■ Grow functionality without writing code. ■■ Cross-connect with complimentary solutions. ■■ Enhance value for customers. ■■ Increase stickiness. ■■ Grow reach.

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5 most common business use of APIs Developing Massive Reach for Transactions and Content Building APIs that accelerate reach fall into two broad categories, depending on the type of product involved:

Content and Data Content and media businesses are continually seeking new ways to reach their audiences. While a company’s own web property and mobile applications may provide the primary means to reach audiences, in the API Economy this is no longer enough: Consumers expect content to be available whenever and wherever they need it, and companies that become adept at delivering this have a powerful advantage, be this on new hardware devices or through partner channels or aggregators. Business Benefits of API Powered Distribution ■■ Low cost partner integration. ■■ Reach niche channels quickly. ■■ Place familiar branded content and purchase opportunities wherever customers wish to access them. ■■ Use context to add value to the customer and your business.

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5 most common business use of APIs Developing Massive Reach for Transactions and Content Transactions Providing inventory and transaction capabilities in a programmatic way and using both to drive transactions is a powerful strategy for businesses, and it can also be beneficial to brick-and-mortar retailers. Since business success is strongly correlated with transaction volume, APIs can enable increasingly powerful affiliate models to drive businesses, or even more radically, wholly self-sufficient third party resellers. Business Benefits of API Powered Transactions ■■ APIs enable third parties to pull inventory, pricing and description information, as well as ratings and much more. ■■ This, in turn, enables resellers to build sophisticated new niche shop fronts. ■■ Sales are subsequently tracked via affiliate links that attribute the sale and result in revenue share payments to the third parties. ■■ Other partners can embed simple product search or purchasing links in their sites, whose main purpose is not to sell but to engage a specific type of audience. The API allows the powerful, flexible selection of the product listing that results in the best fit for the niche audience.

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5 most common business use of APIs Powering New Business Models Emerging Business Models in the API world

Fixed Cost-PerMonth and Tiered Rate Pricing

Different levels of access based on tires of fixed cost-per-month and providing varying numbers of transactions per month.

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5 most common business use of APIs Powering New Business Models Emerging Business Models in the API world

Fixed Cost-Per-Month Tiered Volume Rate Pricing With Overages

The same as the previous model, but allowing price overages when an account is above quota.

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5 most common business use of APIs Powering New Business Models Emerging Business Models in the API world

Providing different types of return data (richer vs. simpler) for different subscription fees.

Data Quality Based Tiered Pricing

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5 most common business use of APIs Powering New Business Models Emerging Business Models in the API world

Up-front purchase of a certain number of usage credits which are then â&#x20AC;&#x153;burned downâ&#x20AC;? by calls made on the API or other events.

Credit-Based Systems

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Accelerate projects Create a safety layer around key assets Create a structure that supports the engagement of external contracts

5 most common business use of APIs

Achieve greater agility and maintainability

Driving Internal Innovation The low-hanging fruit of APIs are generally associated with internal use of APIs. Actively defining the nature of the interfaces to different internal systems, departments and processes creates an environment that is ready for change and innovation.

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Predictive APIs: the mirror in which companies see their future Can you imagine that we could identify those individuals most likely to commit a crime? Or what employees may leave a company within the next six months? What a few years ago would be just a science fiction challenge today is a reality.

The technology sector... has been working for some time now on making the most of APIs (Application Programming Interfaces), those complex algorithms that are revolutionizing the lives of software developers and entrepreneurs. 2014 was definitely the year of those startups that have seized the opportunities offered by open APIs. Among the companies dedicated to providing services through these applications, those working within the field of predictive APIs and machine learning are at the forefront of innovation. Startups like Big ML, Clever Task, Scaled Inference, Datagami, Indico or Dataiku lead a discipline that will change forever the criteria for business investment, management and process control, risk assessment, obtaining predictions of demand, diagnostic, recommendations, stock market, sports results... A true revolution. In fact, large companies with great economic potential such as Google, Mi-

crosoft, Facebook or IBM have been experimenting in this field for a while. Predictive APIs allow the creation of simple tools to process data and create patterns to make decisions. They are also able to learn and predict needs and goals. That is their real power: they not only handle data, they also anticipate it thanks to the design of predictive models based on statistical patterns. Industries such as automotive, banking, insurance, energy, healthcare or retail are already using these APIs.

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The case of Big ML, from theory to practice One of the companies with more potential in the use of these applications and their adoption in machine learning is Big ML, founded by Francisco J. Martín , a Spanish expert in Big Data renowned worldwide. Before launching this startup, Martín led Strands , a pioneer company in the research and application of social recommendation technologies in areas such as music, finance or sports. Always involved in innovative entrepreneurship projects, he also founded iSOCO , dedicated to Artificial Intelligence and the semantic web. Martín’s current team has actually become one of the major players in the industry: Big ML has been rated as one of the nine startups that have improved our lives in 2014 and a report by The Bloor Group states that it is one of the companies to watch in 2015 .

We have customers in the US whose market value is greater than all the Ibex 35 in Spain says Martín, highlighting the strong commitment to predictive APIs on the other side of the Atlantic.

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Among the practical cases Big ML is working on now is:

THE REDUCTION OF NON-PERFORMING ASSET RATIOS of banks or financial institutions. In many cases, credit risk departments fail to evaluate candidates for a loan or mortgage. By using APIs and predictive models, they can detect the customers most likely to default and act accordingly.

They are also working in the retail sector, to ASSIGN PRICES WITH HIGHER LEVELS OF SALES AND DEMAND.

Another of the reasons why large corporations often hire Big ML is for the DETECTION OF FRAUD in procurement systems, guarantee programs or budget management. According to MartĂn, in large companies it is not unusual to detect scams related to negotiations with distributors or suppliers, who may receive cheaper budget proposals aside from the company. Big ML solutions allow managers to detect these frauds easily.

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Easy and scalable solutions The success of this startup lies in making complex things simple. Big ML has grabbed APIs and algorithms related to prediction and machine learning existing for 10 or 20 years, “scientific tools for scientists” as defined by Martín, and simplified them so that they can be used by anyone: “Now they are easier to program and are scalable, therefore they work well with large volumes of data.” This allows dragging data to an interface intuitively, make projections about what will happen in a company and propose initiatives. “The data scientist that many companies are looking for, somebody who knows how to program and also knows statistics and mathematics, is a very complicated profile. Superman doesn’t exist…” says the Spanish entrepreneur. “The truth is that creating your own algorithm to take full advantage of data is very expensive and takes a long time,” he explains. Hence, solutions like Big ML, which seamlessly blends predictive APIs, statistical patterns and data visualization, are tools of great value to any company.

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The future of predictive APIs In a cutting-edge sector as predictive APIs, businesses are always looking to the future. For Martín, the next steps are “working on the composition of APIs; to be able to create ‘meccanos’ of applications that allow us to develop smarter solutions.” At present, there are more machine learning professionals focused on leveraging algorithms that already exist than on the creation of new ones. “When somebody makes an improvement in an algorithm, the leap in quality can be measured in hundredths,” says the CEO of Big ML. Another key element in 2015 will be the standardization process of predictive APIs. “It is possible that we move towards the creation of models that regardless of who, how, when and why, everyone is able to use them,” says Martín. A recent study by the Open Data Institute and Fingleton Associates stressed the need for advances in the standardization of APIs in the financial sector. Based on this analysis, the British government issued a document calling the banking sector to make an effort in this area. It is most likely that something similar will happen with predictive APIs and all the work done by the community of developers in this technological field.

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Global Snapshots Weâ&#x20AC;&#x2122;ll take look at key API management vendors, some examples of API usage from the financial services industry, and notable examples from other industries.

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Leading API Management Vendors

Financial Services industry

Other Industries

3scale 3scale is a young API management vendor. It features a distributed architecture (part of which is open source) with onpremises agents and policy management in the cloud, which is different from the cloud intermediary model of most other API management vendors. The company markets a free 3scale Connect (a standard, self-service product with a ceiling on functionality, usage volumes and restricted SLAs) and 3scale Enterprise (a fully featured platform with strong SLAs, 24/7 phone support and higher transaction volume ranges). The offering is sold worldwide using a Web-based model.

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Leading API Management Vendors

Financial Services industry

Other Industries

Apigee Apigee was an early entrant and has been a visionary player in API management, since the market started developing more than six years ago. It offers a fully functional API management platform (Enterprise), a tool to integrate data from different sources to provide business analytics of developer/customer/ product behavior (Insight) and API Exchange (for the telco industry). Offerings are available in the cloud or on-premises. Most of Apigeeâ&#x20AC;&#x2122;s clients are in the U.S. or Europe.

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Leading API Management Vendors

Financial Services industry

Other Industries

Axway (Vordel) Axway acquired Vordel to mix integration, governance and cloud functions in a B2B infrastructure offering with API management capabilities. The Vordel API Server (renamed Axway API Server, which is available on-premises and in the cloud) provides integration engine services. It is part of the Axway 5 Suite, which offers control and optimization of the flow of data within the enterprise, and externally through integration, community management, visibility, policy and security. Axway (Vordel)â&#x20AC;&#x2122;s main markets are in Europe and North America.

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Leading API Management Vendors

Financial Services industry

Other Industries

CA Technologies (Layer 7) CA Technologies (Layer 7)â&#x20AC;&#x2122;s licensed, on-premises technology is sold under the SecureSpan product name; the cloud entrylevel API CSB and SaaS offerings are sold under the APIfy.co brand as they typically have different buyers. CA Technologies (Layer 7)â&#x20AC;&#x2122;s offering in the cloud is already used by CSBs, mainly telcos and infrastructure as a service (IaaS) providers. CA Technologies (Layer 7) sells mainly in North America, and increasingly in Europe.

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Leading API Management Vendors

Financial Services industry

Other Industries

Intel (Mashery) Intel (Mashery) is at the forefront of API management, and its cloud-centric offering features several areas of functionality that fall under the SOA governance umbrella. An on-premises version of Mashery has been available since October 2011. It offers a wide set of services and policies that span the whole service/API life cycle, with particular attention to the promotion of APIs, and the business issues behind them. The Intel acquisition of Mashery closed on 9 May 2013. However, this report evaluated Intel (Mashery) as a separate entity from Intel (Expressway). Being mainly a cloud offering, Mashery, in theory, is available worldwide (and has some traction with clients in the U.K.), but the majority of its clients are in the U.S. innovation edge | APIs | centrodeinnovacionbbva.com

Leading API Management Vendors

Financial Services industry

Other Industries

MuleSoft MuleSoft offers software subscriptions and cloud services built on the open-source Mule technology. In the application services governance space, the main offerings are Anypoint API Manager and Anypoint Service Registry. Both products are drawn from the same code base and provided as SaaS in support of on-premises and cloud-based services, and API deployments. MuleSoftâ&#x20AC;&#x2122;s offering is designed to be usable worldwide.

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Leading API Management Vendors

Financial Services industry

Other Industries

Genoa - Beeva Genoa is a Beeva manager designed to maximize the benefits of the cloud: fast deployment, maximum performance and flexibility at a lower cost. The client can launch his own APIs platform within hours. It also offers a package of services such as API Proxy, with which you can control and protect the APIsâ&#x20AC;&#x2122; traffic, and use the Traffic Manager, Authorization Manager and Mapping Manager modules to centralize them under a single domain. Besides, Genoaâ&#x20AC;&#x2122;s developer-friendly philosophy facilitates the access of programmers to APIs, enabling them to debug code and test them easily, and locate potential errors in applications more quickly. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

A Financial Services Institution: Improving the user experience and the bottom line 40,000 employees service more than 20 million individual and corporate customers for this institution, which offers hundreds of mutual funds via 5,000 channel partners. The institution achieved its success with a combination of comprehensive service offerings and personalized customer service at competitive prices. The institution believes in the adoption of mobile technology to not only deliver the best possible customer self-service experience, but also to keep pace with the latest customer engagement innovations. With the Axway API Gateway, this financial institution was able to simplify its security architecture, while saving software license, software maintenance, hardware, andadministration costs. In addition to hard-dollar savings, the institution also improved the user experience and accelerated delivery of new mobile service offerings. The institution improved its overall security posture and governance with better auditing, monitoring, and reporting capabilities. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

API Labs at Level39 (Anthemis Group & Pivotal Innovations): New fintech â&#x20AC;&#x2DC;labâ&#x20AC;&#x2122; opens in London API Labs will give UK and international financial services firms a venue to develop ideas from their own technology teams, while also helping them to engage with startups and other external developers and designers. The move is the latest initiative aimed at supporting Londonâ&#x20AC;&#x2122;s growing financial technology sector, as large financial institutions look for innovative solutions to deal with new business and regulatory challenges. API Labs will help foster greater collaboration among financial services firms. API Labs is the specialised platform providing expertise to these companies to develop, test and go to market with new products and services in short time frames to remain competitive and keep up with the pace of technological innovation. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

MasterCard: OTP Bank Hungary Launches First Digital Wallet in Europe to Integrate with a MasterCard and OTP Bank Hungary introduced OTPay, the first digital wallet in Europe to leverage the API of MasterPass. This application is customized to the unique needs of the OTPay customer, making the online use of payment cards easier and more comfortable for cardholders. OTPay will provide consumers a new way to pay online, as well as creating options for bill payment, prepaid top up and person to person transactions. The OTPay mobile application will be available for download not only for OTP Bank customers, but for clients of other banks too. The application will allow cardholders to shop and pay at over 30,000 MasterPass accepting merchants around the world. The application was developed by Cellum, the Hungarian company group known for delivering mobile payment solutions with banking-grade security, also a developer of a MasterCard Mobile solution, which has been running for more than two years. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

Incomm | Cashtie Cashtie API helps you to get paid and to sell your digital goods via major retailers. The Cashtie API connects your application to the cash registers (POS) of major retailers leveraging Cashtie barcodes.

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Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

Mambu Mambu is a SaaS platform for financial institutions. Mambu REST APIs enable its partners to easily integrate local financial services such as credit scoring, mobile money, POS or ATM networks for their clients.

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Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

Motley Fool: Using APIs to Build the World’s Greatest Investment Community “We want a team to decide they need an API, build it, and launch it the same day it’s finished.” Mark Kennedy, Software Architect, Motley Fool. Motley Fool’s APIs are mostly for internal use, but they also have some that are public facing and for partners. A good example of the latter is the stock quote API, which makes stock information available to websites around the world. Motley Fool essentially provide a white label stock quote service through an API.

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Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

Open Bank Project (TESOBE): Bank as a platform. Transparency as an asset. The Open Bank Project is an open source API and App store for banks that empowers financial institutions to securely and rapidly enhance their digital offerings using an ecosystem of 3rd party applications and services.

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Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

Plaid: The Modern API for Banking Data The startup is building a developer platform that allows developers to integrate with data from financial institutions and use it to build applications. Banks are traditional difficult to work with. An API is smart way to start making them more developer-friendly. “As developers in financial technology ourselves, we struggled with the lack of a unified bank API and the low quality of transactional data – so we decided to build the infrastructure to fix it,” said founder Zach Perret in an email. Financial technology has always had significant barriers to entry, and by simplifying the infrastructure we’re helping developers transform the way businesses and consumers use their financial data. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

Standard Treasury: bank tailor new technologies Each year banks spend hundreds of billions of dollars on information technology and services. Yet, it is the poor quality of the products offered by bank vendors that creates much of the friction between banks and their customers. Standard Treasury is bringing bank technology into the 21st century. Standard Treasuryâ&#x20AC;&#x2122;s product is a white-labeled, SAAS, API and developer experience for your customers. For the first time, Standard Treasuryâ&#x20AC;&#x2122;s technology enables enterprises to interface with their bank accounts over RESTful API. For our bank partners this increases the volume of transactional revenue, decreases churn, and creates a marketable differentiator. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from the Financial Services industry

Leading API Management Vendors

Other Industries

TradeKing: Using APIs to Deliver Next-Generation Trading Experiences “Online retail brokerages are seeing more and more traffic moving away from the Web platforms to apps and mobile platforms. Very soon, there will be a new breed of traders who will be completely dependent on mobile apps - we’re at that juncture.” Dan Raju, CIO, TRADEKING TradeKing is a nationally licensed online broker/dealer dedicated to empowering the independent, self-directed investor. The TradeKing platform features powerful online equity, options, ETF, mutual fund and fixed-income trading tools, along with a rich set of news, research and analysis capabilities. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

AT&T: Using APIs to Help Developers Build Great Apps Quickly “The culture around development and delivery is changing. We are accelerating the pace of innovation at AT&T. The transformation that is underway here is about unlocking the value of our platform and delivering new capabilities to our customers faster than ever before.” Jon Summers, Sr. Vice President of Applications and Services Infrastructure, AT&T AT&T, the world’s largest communications holding company by revenue, has embarked on an aggressive campaign to expand its internal innovation capability by opening up its vast telecom network to standard web application program interfaces (APIs). In doing so, it has accelerated innovation by allowing more developers to quickly produce apps that run on the AT&T network. Through the AT&T API Platform, which runs on the Apigee Enterprise API management service, AT&T now has a rapid deployment method for value-added mobile applications, many of which are designed by small firms that previously did not have the resources to commit to AT&T. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Cisco Watch Ciscoâ&#x20AC;&#x2122;s Support APIs Product Manager, Alok Patel, explain how API management facilitates the Support APIs program to increase stickiness with partners and grow revenue for the company.

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Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Coca Cola Enterprises Coca-Cola Enterprisesâ&#x20AC;&#x2122; CTO Kevin Flowers shows how APIs enable multiple units within the business and how API management delivers security, governance, and ease of use to the program. With APIs, Coca-Cola Enterprises has increased the speed of the business, allowing projects to go from taking months and years to just days and months.

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Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Dell: On Using APIs to Provide a Access & New Capabilities â&#x20AC;&#x153;Dell is using this technology to change the face of our online assets, including Dell.com, and to provide multi-channel access and new capabilities that extend beyond the scope of Dell owned properties.â&#x20AC;? Mohamed Ayadi, Director, Online Product Engineering, Dell For more than 28 years, Dell has empowered countries, communities, customers and people everywhere to use technology to realize their dreams. Customers trust Dell to deliver technology solutions that help them do and achieve more, whether theyâ&#x20AC;&#x2122;re at home, work, school or anywhere in their world.

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Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Orange: Empowering Emerging Markets through API Publication Orange is the key brand of France Telecom, one of the world’s leading telecommunications operators. As the number three mobile operator and number two provider of broadband internet services in Europe, as well as a global leader in telecom services for MNC’s, Orange Group’s strategy is characterized by a strong focus on innovation and working to develop its position in new growth activities. One area of growth opportunity lies in a. In much the same way that publishing a Web site can expose a local business to a global marketplace, making APIs available online can help drive new partnerships, improve customer satisfaction and build value added services around a brand, all of which can lead to increased revenue opportunities. Orange’s Nursery initiative is aimed at just that – publishing their telecom services, provisioning, management and configuration APIs in order to foster innovation and reduce cost of/time to market for new services. Benefits have been quick to accrue: by providing developers with secure access to telecom service and data APIs via the Nursery, Orange has created a far more agile IT platform on which to develop new offerings faster and at less cost by reusing/recomposing existing services. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Pearson: Plug & Play Platform “The world is changing - becoming more open. There has been an important shift in the ecosystem around us, and APIs are becoming the norm.” Diana Stepner, Head of Future Technologies, PEARSON

Pearson is the world’s leading learning company. Pearson delivers content in a range of forms and through a variety of channels, including online services, ebooks, books and newspapers. It provides consumer publishing through the Penguin brand, educational materials and services, and business information through the Financial Times Group.

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Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Samtrafiken: APIs Providing a Path to Innovation in Public Transportation “We’ve realized that APIs are the cheapest and fastest way to build applications. And most importantly, APIs let third parties extend our products and services.” Elias Arnestrand, Innovation Manager, SAMTRAFIKEN

Samtrafiken is a non-profit organization jointly owned by 34 public transport operators and authorities in Sweden. Samtrafiken’s vision is that public transport will be seen as simple, reliable, and convenient and become the number one choice for every journey. Their goal is to bind all of Sweden together by allowing the public to easily travel between destinations using a single ticket for any mode of public transportation. innovation edge | APIs | centrodeinnovacionbbva.com

Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Sears: Leading the Retail Industry Transformation Through Technology “Over the past few years, Sears has led the transformation of the retail industry through technology adoption. We recognized early that embracing APIs as an organization-wide glue for building applications enabled unprecedented scalability and flexibility.” Kandarp Bhatt, Director, eCommerce Product Management, Sears Holdings Corporation Sears Holdings Corporation is a leading integrated retailer with almost 2,500 full-line and specialty retail stores in the United States and Canada. Sears is the leading home appliance retailer as well as a leader in tools, lawn and garden, fitness equipment and automotive repair and maintenance. Key proprietary brands include Kenmore, Craftsman and DieHard, with a broad apparel offering, including such well-known labels as Lands’ End, the Kardashian Kollection, Jaclyn Smith and Joe Boxer, as well as Sofia by Sofia Vergara and The Country Living Home Collection.

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Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Tom Tom Watch TomTomâ&#x20AC;&#x2122;s Fellow of Location Based Services, Peter Moeykens, explain how the company went from managing APIs in-house to signing on with Mashery and creating pyramid of technology that enables TomTom to leverage and monetize its data. TomTom currently sees 13 million transactions per day through its Mashery-powered API and expects that number to double in 2014.

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Some examples from Other Industries

Leading API Management Vendors

Financial Services industry

Walgreens: Putting an API Around Their Stores “The goal is to drive customer interactions. It doesn’t matter where it starts from because it’s all flowing into your business.” Joe Rago, Senior Product Manager, WALGREENS MOBILE Walgreens is the largest drugstore chain in the United States, operating more than 7,900 drugstores across the country. Each day, Walgreens provides nearly 6 million customers with convenient, multichannel access to consumer goods and services and trusted, cost-effective pharmacy, health and wellness services and advice. In July, 2012, Walgreens built on its tradition of technology innovation with the introduction of its first open API, QuickPrints. innovation edge | APIs | centrodeinnovacionbbva.com

BBVA Experience BBVA aims to lead the transformation of the banking industry by playing an active role within the digital ecosystem and open platforms. The challenge is to be able to add value to an ecosystem where APIs are the bonding glue. To achieve this goal we need to be closer to the real needs of customers, developers and potential partners.

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One of BBVA’s approaches to become a refe rence in banking APIs is the Open Platform strategy. This is a project that arises as a result of the bank’s intention of exposing its assets (information, services and products) and sharing them with all actors involved (partners, developers and customers.)

Experience with datathons BBVA is a pioneer in the organization of open innovation activities such as datathons. So far there have been two editions of the “Innova Challenge” competition, for which an API of transactional data was opened in Spain (2013) and Mexico (2014).

The goal is that companies and individuals located anywhere can build products using these assets, enriching their ideas and talent, BBVA’s offering, and what the end users finally see. All this ultimately benefits innovation, the industry’s digital transformation, and the own BBVA.

■■ The

This is possible because APIs can be, on the one hand, facilitators of new business models, but on the other hand they are also a channel that can greatly increase the distribution of the bank’s current products.

aggregated transactional data made available by BBVA doesn’t identify specific persons or business.

■■ These

experiences with datathons allow BBVA to identify new talent, validate hypotheses, discover new ways to leverage information, and know better the potential users of the APIs (developers and small software companies), besides fostering a community of collaboration between developers, startups and BBVA.

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Open the bank The bank has been using APIs to facilitate different technological developments. For instance, APIs for internal use are being applied in webpages and mobiles, providing significant levels of efficiency. The bank is also preparing to open certain services not only to partners, but to all the developer community. By doing this, BBVA aims to add value, diversity, and encourage the development of applications and services unthinkable until now: ■■ The

first example of partnership is Dwolla , an innovating company in the payment systems field that uses BBVA’s APIs in the US to offer real-time services, such as transfers to BBVA Compass clients, who don’t need to wait 3 or 4 days to send or receive funds. Since April, users of this service can transfer money instantly paying a flat rate of 25 cents per transaction if it’s over 10 dollars, while for smaller amounts the process is free.

Not trivial Creating banking APIs is not just simply packaging the bank’s assets and launching them as services. It requires to define clearly what services will be offered, study the demand and follow a common strategy with the other digital banking projects. Therefore, the Open Platform project is working with agile methodologies such as Scrum, and with a strong coordination across many areas of the bank. There are teams working on this project in several countries, and very soon we will be able to announce new develop ments in this exciting and ambitious project.

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Innovation Forecast As seen, there are some interesting stuff going on with APIs and innovation. Though it seems that all of this is just starting, there are some key lessons learned. Here what some experts had to say:

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After going at it for a while, API experts offer the following eight recommendations When analyzing digital landscape, it becomes clear that leading companies create and maintain interfaces to their businesses.

They create programmable businesses: ■■ Enforcing the disciplined, internal usage of well-structured interfaces. ■■ Providing powerful integration points. ■■ Establishing clear strategies for partner and customer engagement.

1. Serve both internal and external needs Organizations need to make sure that resources can be managed appropriately so they fit into the overall picture of company operations. In particular, they need to deliver internal efficiencies as well as new opportunities for topline growth. For example, they may need to balance the needs of a newly mobile workforce with increased external access to customer data.

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3 5

4 7

6 2. Work towards defensible strategic advantage Organizations must put structures in place that leverage key company strengths and assets in a powerful and agile way. They also need to enable these assets to be put to use as fully as possible.

3. Align IT with business goals Organizations must ensure that the overall infrastructure of the company is streamlined to enable and process the key types of transactions the company is aiming to fulfillâ&#x20AC;&#x201D;be they transactions for physical goods/ services or digital items.

4. Future-proof investments As software systems are built out, organizations need to make them modular and re-usable, to avoid large IT budget hits further down the line.

8 6. Move to innovative cloud service suppliers Shifting cloud infrastructure often allows organizations to reduce cost and increase functionality. In doing so, however, they need to avoid fragmentation and infrastructure risks, which complicate corporate internal IT.

7. Provide increasingly real-time access Enabling fast, on-demand access to remote facilities, supply systems and external providers, while avoiding rapid escalations in cost and complexity.

8. Enable others outside 5. Find efficient, cost effective solutions Organizations need to keep costs under control, to avoid wiping out productivity gains with investments that have hidden costs over time.

the organization to connect to, and use, the deployed software Enabling third parties with various levels of trust to create new innovative services.

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Books &

publications

In depth A list of links to other useful tools and resources that you may find useful as a supplement to the information offered on the â&#x20AC;&#x2DC;Make me APIâ&#x20AC;&#x2122; report.

On the

web innovation edge | APIs | centrodeinnovacionbbva.com

Books & publications 3scale | Winning in the API Economy, 2013. Apigee | Apigee Insight - Data as Currency and Catalyst in the App Economy, 2013. Apigee | Are You Where Your Customers Are?, 2013. Apigee | Digital Transformation, Getting in Shape for the Digital World, 2013. Apigee | Programmable World, Programmable Enterprise, 2013. Apigee | Securing the Digital Enterprise, 2013. Apigee | Three Keys to Digital Transformation, 2014. Boston Consulting Group | The 2013 TMT Value Creators Report: The Great Software Transformation, 2013. Forrester | Forrester Wave: API Management Platforms, Q1 2013, 2013. Gartner | Gartner Magic Quadrant for Application Services Governance, 2013. Gartner | The Nexus of Forces: Social, Mobile, Cloud and Information, 2012. IBM | The Customer-activated Enterprise - Insights from the Global C-suite Study, 2013. Daniel Jacobson, Greg Brail and Dan Woods | APIs: A Strategy Guide, 2011. Mashery | Accelerated Commerce: Key API Strategies for Digital Retail. Mashery | Driving Real-World Enterprise & B2B Results with APIs. Mashery | Success Guide: Seven Reasons Leading Companies Manage APIs in the Cloud. Mashery | Success Kit: How to Get People to Love (and Make Money) from Your APIs. Mashery | Turbocharge Your Mobile Strategy with APIs. Mulesoft | The 7 Habits of Highly Effective API and Service Management. Mulesoft | The Blueprint to Becoming a Customer Company. Mulesoft | How to Make Your App Enterprise Ready. Mulesoft | The State of Cloud Integration 2013. Rene Rohrbeck | Corporate Foresight: Towards a Maturity Model for the Future Orientation of a Firm, 2010. Vision Mobile | The European App Economy, Creating jobs and driving growth - sizing the European App Economy and advocating policy options to drive growth, 2013. Audrey Watters and Kin Lane | Business of APIs, 2011.

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Web 3scale | API Predictions 2014, Diciembre 2013. 3scale | Identity and The API Economy, Noviembre 2013. 3scale | The Age of Context and the API Economy - One can’t exist without the other, Noviembre 2013. API Strategy & Practice | blog, 2014. Apigee | Apigee Acquires InsightsOne - Doubling Down on Big Data, Enero 2014. Manfred Bortenschlager | The API Economy explained … and how to capture its value, Febrero 2014. CA Technologies | CA Technologies to Acquire Private-held Layer 7 Technologies, a Leader in API Management and Security, Abril 2013. FinSMEs | 3scale Raises $4.2M in Funding, Abril 2013. GigaOm | The rise of mobile-first infrastructure, Marzo 2014. IT Business Edge | Five Reasons a Business Needs APIs (and an API Driven Strategy). Kin Lane | The API evangelist. Layer 7 Technologies | The State of API Design, info infographic. McKinsey & Co | Competing in a digital world: Four lessons from the software industry, Febrero 2013. McKinsey & Co | Ready for APIs? Three steps to unlock the data economy’s most promising channel, Enero 2014. Mulesoft | Mulesoft Acquires ProgrammableWeb, Abril 2013. Programmable Web | Private, Partner or Public: Which API Strategy Is Best For Business?, Febrero 2014. ReadWriteWeb | Intel is Buying Mashery to Get Deeper Inside the Data Center, Abril 2013. ReadWriteWeb | What APIs Are And Why They’re Important, Septiembre 2013. Salesforce.com | Why every business is an API business, Marzo 2014. Techcrunch | Microsoft Acquires Apiphany - An API Management Service to Integrate with Windows Azure, Octubre 2013. VentureBeat | MuleSoft raises $50M to connect every business app to every other business app, Marzo 2014. YouTube | The App Economy in 5 minutes (Apigee), Octubre 2011.

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1 Trending issues Summaries of the most relevant news of selected topics that have been published over the course of the period based on its relevance to the Banking industry. The summaries were prepared by the editorial board. Further information is made available for each given topic.

also in this issue

2 Technology trends In the following section, we outline the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.

Innovaci贸n

Highlighted in this section some of the actions in which BBVA Innovation Center takes part, on innovation and entrepreneurship. Through this section we also provide direct access to the BBVA Innovation Center events. innovation edge | APIs | centrodeinnovacionbbva.com

Trending issues

In this section, readers will find summaries of the most relevant news of selected topics that have been published over the course of the month based on its relevance to the Banking industry. The summaries were prepared by the editorial board. Further information is made available for each given topic.

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity Brands & Branding

How to standardize the systems of core banking platforms BIAN, an international organization that develops standards for providers of banking technology, is creating a framework to give independence to banks and avoid their reliance on a technology supplier. This framework is intended to integrate different technology components that are compatible thanks to open standards. PNC Financial Services Group is one of the financial groups working with BIAN in these regulations.

Crowd Finance App Ecosystem Gadgetology New Banking Concepts Big Data Future of Work DIY innovation edge | APIs | centrodeinnovacionbbva.com

Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity Brands & Branding

Beacons and videos on social networks set the course for the future of m-commerce According to Appsbuilder, beacons (devices that broadcast a short-wave signal in Bluetooth) will take a great leap this year, integrating user data and customizing push notifications. Video ads will be another star format in 2015, thanks to the development of previews on social networks. These are two of the trends that will mark the future of mobile commerce, not to mention the rise of wearable devices.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

The growth of m-banking in the US A report by the Carlisle & Gallagher Consulting Group highlights that 55% of Americans are accessing their bank accounts two or three times each week through mobile devices, either from laptops, tablets or smartphones, while 26% of them log-in up to four times a week. The main reason: â&#x20AC;&#x153;instant gratificationâ&#x20AC;?.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

The rise of social graphs in business The value of social reputation in the area of business is on the rise and brands are trying to take advantage of this boom with social applications that help them enhance their brand among users. For example, TripAdvisor leverages Facebookâ&#x20AC;&#x2122;s social graph to ensure that when you search for hotels, restaurants, etc., any comments posted by people you know appear at the top.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

The consumer, the obstacle to overcome for mobile payments One of the reasons why in 2015 payments through mobile devices will remain one of the most innovative trends will be due to consumers. Everything will depend on the confidence that consumers have in these new technologies, the safety and ease of use of these applications. In fact, the exchange of money through smartphones with specific payment apps is increasing.

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Trending issues

Core Banking Platform New Formats Mobile Banking

Seven steps to lead the customer-centric experience

Social Business

To lead a change of culture focusing the strategy on the customer, seven steps must be followed:

Mobile Payments

1. Decide to promote this change in the company. 2 Spell or explain in one sentence the challenge you want to achieve with this change. 3 New business decisions have to be thought or oriented keeping this new strategy in mind. 4 The customer-centric experience values must be instilled in each of the employees of the company. 5 Standardize as much as possible, in order to be able to deviate from those guidelines when a situation requires a different approach. 6 Commitment to empower employees, so they can know what is needed even if they donâ&#x20AC;&#x2122;t know how to do it. 7 Maintain the momentum of the new strategy.

CustomerCentricity Brands & Branding Crowd Finance App Ecosystem Gadgetology New Banking Concepts Big Data Future of Work DIY

Trending issues

Core Banking Platform New Formats Mobile Banking Social Business

Four professional ways to improve your digital brand strategy There are digital platforms that can become crucial to digitally enhance your brand if you know to take advantage of their full potential. We present you four, so you can start to try:

Mobile Payments CustomerCentricity Brands & Branding Crowd Finance App Ecosystem

1. YouTube: although the content may be more difficult to create, it can be a great gateway for your brand. 2 BuzzFeed: creating a channel is free and a great way to appeal to many users. 3 Playbuzz: creating one of these tests and sharing it with your followers can be fun and give a different image to your brand. It can be a fun way to inform. 4 Udemy: you can be an â&#x20AC;&#x153;instructorâ&#x20AC;?, as you are an expert in your field, and share your knowledge on this online education platform.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments

Indiegogo opens the door to financing personal causes This crowdfunding platform has launched a new service for users who need to raise money for a personal cause, such as medical expenses, tuition fees or even a vacation. Itâ&#x20AC;&#x2122;s called Indiegogo Life, and itâ&#x20AC;&#x2122;s free of charge. P2P (person to person) funding to its fullest extent.

CustomerCentricity Brands & Branding Crowd Finance App Ecosystem Gadgetology New Banking Concepts Big Data Future of Work DIY innovation edge | APIs | centrodeinnovacionbbva.com

Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

A solution to generate sales With the new DPS for Sales Enablement solution, Adobe allows to create a customized application for interactive sales presentations that drive business sales. The aim of this solution is to transform business sales efforts, allowing more interactions to attract customersâ&#x20AC;&#x2122; attention. Furthermore, this solution enhances sales by presenting all interactive materials updated, which benefits the ROI of the company.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity Brands & Branding Crowd Finance

Four gadgets for frequent travelers 1. August Smart Lock: your smart home must have this keyless entry system, which works thanks to a tool that is installed in the lock of the door and a mobile app. It allows you to give access to friends, neighbors, family, etc. for a number of days and change the settings remotely. Perfect for watering the plants when you travel. 2 Petcube: connected to the Wi-Fi, it allows you to monitor your pets while youâ&#x20AC;&#x2122;re away from home through a video. It even lets you to talk or play with them remotely. 3 GoPro Hero4: perfect for photography enthusiasts, as it lets you take pictures with little light, at night or with custom settings. 4 Print Smartphone: it turns your mobile device into a camera and an instant photo printer. It doesnâ&#x20AC;&#x2122;t require an internet connection and includes an internal rechargeable battery.

App Ecosystem Gadgetology New Banking Concepts Big Data Future of Work DIY innovation edge | APIs | centrodeinnovacionbbva.com

Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity Brands & Branding Crowd Finance App Ecosystem Gadgetology New Banking Concepts Big Data Future of Work DIY

Number26, a new banking experience A native application that you install on your phone and with which you can open a new banking account in less than eight minutes. You need an email, a password and some basic information. Your identity will be verified during a video-call in which you will have to show your passport to a customer representative who will take a picture of both the document and you to complete the process. A few days later, you will receive a credit card and will be able to make transfers with your new account.

Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

What’s after Big Data? Now that Big Data has started to spread across companies, the most dynamic ones already begin to wonder what happens next. The answer is not easy, but it’s always a good idea to see what research labs are working on. Until recently, processing and managing Big Data has occupied an important part of the scientific community’s research; now they are also finding ways to obtain automatically predictive and prescriptive analysis based on large amounts of data which generally don’t contain metadata to facilitate their interpretation.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

New technology companies rely on freelance workers Increasingly large technology companies are changing part of their workforce and hiring independent employees, freelancers, mainly due to the savings they represent in fixed salaries and the taxes involved. However, these freelance workers lose social benefits and tend to work a higher average of hours per week if they donâ&#x20AC;&#x2122;t have a good planning.

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Trending issues

Core Banking Platform New Formats Mobile Banking Social Business Mobile Payments CustomerCentricity

Build your own Linux handheld computer A small computer which is basically a full Linux system that fits in the palm of our hand and is able to do almost everything we can do with a normal computer. All components used to build this device are available at most online stores. The brain behind this invention is Raspberry Pi, the reference together with Arduino in open hardware, which will give us hours and hours of fun.

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EACH SECTION EXPLAINED

Core Banking Platforms Here you will find articles related to basic IT infrastructure which supports main banking processes, including technologies such as SOA, WOA, digital platforms, etc.

New Formats Based on design principles focused on customer insights, New formats offers retail banking customers more channels which are more granular and highly functional; a consistent, simple, and collaborative universal user interface; real-time intelligent processes; highly personalized solutions; and is open to social networks and the web. Examples of these new formats are provided here.

Mobile Banking Relevant news about mobile banking platforms (which enable customers to access financial services, such as transfers, bill payments, balance information and investment options) can be found here.

Social Business Social Business is the integration and use of social technologies by an organization, which includes social media/work media, crowd listening, crowd intelligence, crowd working, etc. Stay tuned to see how this space will evolve.

Mobile Payments The process of using a hand-held device to pay for a product or service, either remotely or at a point-of-sale. Up to date information is provided.

Customer-Centricity Customer-centricity is the organization’s understanding of customers at a granular level and the capability to create, deliver, and capture different kinds of value propositions to different groups of customers, based on customer understanding.

Brands & Branding Marketing in the modern world have many channels to reach consumers at their disposal: (smart)phones, tablets, PCs and (smart)TVs and different ways to communicate their brands, such as traditional ads, banner ads, SMS/MMS, etc.

App Ecosystem There are 5 main components in the current Apps Ecosystem: connectivity, devices, OS platforms, app platforms, and apps; along with related products and services providers (MEAPs, Mobility as a Service providers etc.).

Gadgetology Gadgets are everywhere and it seems that there are more and more each passing day. We are moving towards a contextual computing environment and, as a result, the number and functions of gadgets are poised to grow (thanks in part to the internet of things). In this section, we share a word or two about gadgets.

New Banking Concepts Banks around the world continuously explore new approaches to strengthen customer relationships, both in the virtual and the physical worlds; including Virtual assistants, natural language search tools, new marketing tools, different segmentation (children, gen Y,…) etc. This section will cover news along these lines.

Big Data It been said, “what gets measured, gets managed.” The Big Data trend offers organizations an opportunity to manage just about everything. Here we’ll share stories about Big Data capture, curation, storage, sharing, analysis, and visualization.

Future of Work Work, increasingly, is not about where you do, but what you do. The future of work is more flexible and collaborative; and values are going to play an important role, especially corporate values. The way we work is changing fast … stay tuned.

DIY Do It Yourself (DIY) refers to a trend of people doing “projects” to either be creative/recreational and/or costsaving activity. This trend becomes really interesting as new technologies enable new functionalities such as 3D printing, health/wellness, etc, which help empowers individuals; this may even change the we think about businesses in the future.

Crowd Finance A process where small amounts are money raised for a definite purpose, Crowd finance sources funds collectively from individuals. In other words, the money comes from a wide range of individuals and not from a single entity. Read more about it here.

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Technology trends The following section outlines the upcoming technologies that will change everything, with predictions on what may come of them in financial industry.

Wearable Tech, as Big as the Smartphone More and more consumers are interested in tracking their routine activities, and more and more mobile applications allow monitoring them. Besides from knowing oneself better, measuring parameters such as the blood pressure, pulse and steps helps individuals take care of their health and improve their physical condition. Today’s smartphones can measure large amounts of data, but data is not useful if you can’t see it when you need it. That’s why wearable devices were born, and with them a new way of using technology. Wearable technology allows us to have the smartphone’s screen continuously in our field of vision, keeping our hands free at all times and liberating us from uncomfortable actions such as having to take the phone out of the pocket or typing on the screen.

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It’s clear that wearable technology will revolutionize the world. The same way mobile phones and tablets have replaced PCs, wearable tech will replace smartphones, and will do so sooner rather than later. That’s why we’re seeing such a sudden explosion of these devices in the market. Google has invested millions in its Google Glasses, Samsung and Apple have introduced yours smartwatches. These devices not only allow us instant access to information about the world surrounding us - they go beyond: they observe behaviour patterns, scan our agenda, provide additional information to our physical reality, they know the user’s needs, and they are even able to send instructions when these are about to ask for them.

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The first wave

earable technology is still in its infancy, but here are some of the products you may already be seeing on the street. Fitbit Force ($130) and Zip ($60) Fitbit makes a range of activity trackers, from the Force, which can double as a watch, to the Zip (left).

Jawbone Up24 ($150) This new fitness tracker stays connected with your phone via Bluetooth, letting the app ping you with personalized inspiration.

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■■ Shine

Fitness Tracker ($120) Sonny Vu’s graceful aluminum disc matches the functionality of other trackers in a stylish, minimalist form.

■■NFC Ring (Price TBD) This simple metal ring

comes embedded with a radio chip that lets it open doors, make payments, and more. BSamsung Galaxy Gear ($300) With its bright screen and wristband camera.

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Pebble ($150) With more than 250,000 sold, the Pebble has attracted a huge community of developers, who make apps that migrate functions off the phone and into the open.

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In purely technological terms, the wearable revolution could take shape much faster than the mobile revolution that preceded it. Thanks to what former WIRED editor in chief Chris Anderson has called the “peace dividend of the smartphone wars,” sensors and chip sets are cheaper now than ever, making it easier for small companies to incorporate sophisticated hardware into wearable devices.

MetaWatch Frame ($230) With its steel case and leather band.

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And while smartphone manufacturers had to master the tricky art of providing dependable mobile Internet service, wearable manufacturers can piggyback on those innovations using simple Bluetooth or other protocols to communicate with a smartphone and thus with the outside world. With all that prebaked hardware and wireless connectivity - and huge preorders from crowdfunding platforms like Kickstarter - it has become possible for tiny companies to dream up, build, and sell wearable devices in competition with big companies, a feat that was never possible with smartphones.

The rise of the personal cloud

ervices like Dropbox, iCloud and Google Drive have become essential to society. Even other more specialized services such as Evernote, Wunderlist and Pocket are increasingly being used by consumers. But few people are familiar with the concept of cloud. There are three main types of cloud:

PUBLIC CLOUD Where my data is stored along with everybody elseâ&#x20AC;&#x2122;s data. PERSONAL CLOUD Built from your own hardware and software. Itâ&#x20AC;&#x2122;s a cloud entirely yours, and from no one else. PRIVATE CLOUD To which only a specific group of people have access.

So it was just the beginning. A new generation of wearable tech is coming and it will transform the way you experience the world. Source: www.wired. com/gadgetlab/2013/12/ wearable-computers/

PUBLIC CLOUD

PERSONAL CLOUD

PRIVATE CLOUD

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According to Gartner, consumers only upload 7% of their files to the cloud. Indeed, there are a number of obvious reasons for not uploading them. Among them: cost, security and complexity. People have a lot of data spread over a large number of devices, and although in recent years the low cost leaders in cloud storage (Amazon, Microsoft and Google) have reduced their prices by an average 30-40% each year, consumer’s data is growing fast, almost 50% annually. Storing all data in the public cloud would cost them hundreds of dollars a year, and it’s expected to increase in the future. If we add the absolute control users want over their data, the personal cloud becomes the most attractive alternative. According to a Forbes interview with Gartner, “the personal cloud will entail the unique collection of services, web destinations and connectivity that will become the home of computing and communication activities.” Gartner also predicts that the personal cloud will be fully adopted in 2015, although less than 10% of consumers will use cloud services as their primary storage this year.

Sources: www.thenextweb.com www.forbes.com

The cloud will become the centrepiece of our digital lives, and for this reason it’s a force to be taken into account in the business technology scene. IT executives, suppliers and analysts alike are trying to keep up to determine what it really means and where it’s leading us. The personal cloud will challenge companies to be more attentive to new technologies and consumer services. The emergence of smart devices and of the popular tablet in the workplace is just the tip of the iceberg. The tablet announces a future where the device is merely a point of access to personal and private content. With the personal cloud the multi-device experience will be easier, more effective and safer.

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BBVA Open Talent 2014 reaches entrepreneurs from 56 countries The sixth edition of the BBVA Open Talent startup competition has been a complete success: more than 870 registered projects in 56 countries between the two categories, Digital Life and New Banking. Open Talent is preparing its next edition to be launched in May 2015. If you are an entrepreneur and have an innovative project, stay tuned to the web www.bbvaopentalent.com!

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BBVA Open Talent 2014 has seen how the international participation has intensified in this call, structured around three editions targeting different regions: Central-South America, North America & Rest of the World, and Europe. This new organization has allowed to reach entrepreneurs in more places, from Australia to Costa Rica and Cuba, Hong Kong and Germany. Spain, Argentina and Mexico were the countries with the largest representation in the competition, followed by the US, which with 80 participants embraced vigorously this sixth edition, compared to the scarce activity registered in previous years.

Another milestone for BBVA Open Talent 2014 was the boom experienced by the New Banking category, which increased almost 80% over the previous edition and received 166 proposals about innovation in the financial sector. These figures position BBVA Open Talent as an international benchmark for entrepreneurship within the field of tech-based banking services and products.

If you want to see the highlights of BBVA Open Talent 2014... Donâ&#x20AC;&#x2122;t miss this video!

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The winners of the 6th edition are:

BBVA Open Talent Central and South America: ■■ Winner New Banking:

Bankity It offers a service that helps to control the costs associated with cards, including a daily analysis of them.

■■ Winner Digital Life:

Cloudgrid A startup that allows to manage energy resources and the electricity network from the cloud, through realtime data analysis and monitoring. innovation edge | APIs centrodeinnovacionbbva.com

BBVA Open Talent Europe: ■■ Winner New Banking:

Clausematch A platform for negotiating trade agreements, with a system that facilitates cost savings and market transparency. ■■ Winner Digital Life:

Counterest A tool that counts people and applies web analytics to retail stores, measuring in real time the effectiveness and impact of advertising and marketing campaigns.

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BBVA Open Talent North America & Rest of the World: ■■ Winner New Banking:

Socure An artificial intelligence system that protects against online identity fraud and reduces false positives/negatives in selection processes and businesses, thereby reducing costs and time.

■■ Winner Digital Life:

GridMarkets A platform that allows users to share in an affordable and convenient way the excess capacity of the cloud throughout the world, in fields such as engineering, finances and animation.

■■ The most voted project online was

the Mexican startup: Cúrsame

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These seven winning projects along with the six runners-up had the opportunity to enjoy a program for startups in New York specially designed for them: the NY Crash Acceleration Week. During one week they were able to contact investor networks, receive training on how to develop their startup... and even competed in the Empire Startup Summit. One of them, TransferGo , an application for sending money easily, actually won the competition. It was the perfect finale for BBVA Open Talent 2014.

Coming BBVA Open Talent 2015

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InnovaChallenge MX, an example of open innovation and implementation of Big Data in BBVA Relocation Assistant, a system that allows you to choose the best neighborhood to live in, and Pear Campaigns, a solution to create geomarketing campaigns, are the winning apps in the citizens and business categories of the InnovaChallenge MX datathon organized by BBVA. innovation edge | APIs | centrodeinnovacionbbva.com

BBVA Bancomer offered 378 developers from 36 countries dissociated and aggregated card transaction data from Mexico City, Guadalajara and Monterrey to create their applications. More than 50 apps were finally submitted to the challenge using the data offered by BBVA. In fact Innova Challenge is a clear sign of the bankâ&#x20AC;&#x2122;s commitment to open innovation and the application of Big Data, providing real commercial activity data to developers. The quality of the works submitted surpassed the expectations of the jury. The awards were divided between two categories: apps for citizens and apps for business, with three prizes of 15,000, 10,000 and 5,000 euros for the winner and runners-up. There were also five honorable mentions of 1,000 euros.

Winners in the apps for citizens category Relocation Assistant by Luca Chiarandini (Spain) This app allows to compare neighborhoods and add criteria such as schools nearby, night life. The app is already operating in Spain (Madrid and Barcelona) and Mexico (Mexico City, Guadalajara and Monterrey). Socio by RubĂŠn Sandoval (Mexico) The P2P lending boom has also been visible in this datathon. This crowdsourcing app helps users find financing and partners with common interests in nearby locations. Optim by Delta Hat SL, (Spain) This app allows users to choose the best place to spend their leisure time, according to their tastes and desires at any given moment.

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Winners in the business app category Pear Campaigns by Jordi Nin Guerrero (Spain) An app that allows inexperienced users to design effective geographic marketing strategies in a very easy way. Flux MX by Daniel JuliĂ Lundgren (Spain) A solution that provides interactive visualizations of the transaction flows between the different zip codes of a city. App Data by Carlos Hugo GonzĂĄlez Castell (Mexico) A tool that helps business owners decide about opening a new business or expand their current one.

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Crowdfunding, a financing alternative for entrepreneurs and investors

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Crowdfunding is much more than a P2P (peer to peer) financial alternative â&#x20AC;&#x201C; itâ&#x20AC;&#x2122;s the application of a collaborative model in the financial field. This document analyzes this innovative financial trend that both entrepreneurs and investors area leveraging.

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P2P Finance, an alternative ecosystem P2P financial systems are becoming more common in our economy. We would like to provide you with the keys to a better understanding this ecosystem.

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Data, all about Big Data ecosystem Big Data and Data are two of the hottest words in the innovation ecosystem and entrepreneurship. We show how it is evolving trend. The use of data and analysis to predict trends and behaviors is already among us and promises to stay long. This trend gets practice in different areas: social, economic or political.

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Internet of Things The Web is now ubiquitous. It can be found in our homes, our cities, our businesses... Even on our day-to-day devices, from a refrigerator to our illumination systems. have become a source of data with the objective of making our lives easier. Itâ&#x20AC;&#x2122;s the new Internet revolution. The Internet of Things has been no stranger to our ears in the past years, but it looks like 2015 will be its big year. Although we are familiar with what it has to offer, it still has to face many great challenges.

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Wearables, mobile revolution Is it just a fashion trend or will be a now mobile revolution? The wearable devices begin to be gradually in some of our daily uses: at work, doing sports or playing, in health centers ...

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