Google announced their plans to acquire API management company Apigee on the Google Cloud Platform Blog on September 8. Apigee is best known for its API gateway software, Apigee Edge, which lets users take advantage of general API management, operations, and analytics tooling.
In their press release, Apigee writes that they will be acquired for approximately $635 million and expect the transaction to officially close by the end of 2016, pending stockholder and regulatory approval. In Google's press release on their blog, they mention their key reasons for acquiring API management provider. The first motivator Google describes is that Apigee is established in the community as a well-known API management provider and thus has a great foundation of existing customers. Google next mentions Apigee's work in API cloud management and places special focus on Apigee's software customizability, which allows API developers to produce their software at full velocity since they don't have to create all the infrastructure around their services from the ground up.
Google has released a number of complex APIs in recent months, ranging from NLP (natural language processing) to charting software. They recently also announced a number of further API additions and enhancements to their roadmap. As the popularity of analytics and data science grows, so does the need for accessibility to the complex underlying processes beneath this cutting edge functionality. As a result, a number of analytics APIs from companies like IBM and Microsoft have been released this year.
With the rise of intricate APIs comes increasingly high maintenance. Large companies like Google operating with vast amounts of data, have to make sure that data encryption/decryption, compliance, user roles and privileges, and traffic management are handled properly across all their APIs without error and this only still comprises the very basic levels of API management. Analytics and developer tooling, especially for intricate data heavy APIs can grow to be complex services in of themselves. Acquiring Apigee, whose entire focus is API management, means Google can focus on releasing increasingly complex research-driven APIs without having to built out a large portion of the underlying maintenance and tooling themselves.
Google recently acquired the e-commerce cloud management company Orbitera just couple of months after Apigee announced a partnership with cloud platform company Pivotal. The Apigee collaboration with Pivotal comes at the end of Apigee spending the past year building and releasing specialized hybrid cloud API management software. While there are several API management tooling platforms on the market, Google may have been attracted to Apigee's recent specialized cloud development work, given their recent other acquisitions. In the acquisition press release Apigee's CEO, Chet Kapoor mentions their hybrid cloud software synergy with Google directly: "We've entered a new era of cloud computing, where enterprises are increasingly running business-critical applications in the cloud - and across multiple clouds. Google is the open cloud provider committed to delivering new software for not only hybrid-cloud environments, but also for the multi-cloud world". Apigee also has a large existing customer base that includes Walgreens, Staples, etc. which aligns with Google's API Partner Ecosystem program that encourages early adoption of their prerelease API technology by enterprise clients to prove its viability.
In their press release, Google stresses that with Apigee's integration with their container-based orchestration tool Kubernetes they've created the perfect platform for maximal developer velocity and autonomy. Google writes about Apigee's software "offering a good API goes well beyond having the company develop and publish a performant specification of the interface. A good API needs to support security, give developers the freedom to work in the development environment of their choice and allow the company to continue to innovate its service while supporting a stable interface to the apps and services using the API." Google contests that because developers will have to concentrate less on API and operations management they can spend more time focusing on creating the software they're passionate about.