Redefining The Function Of A Web Site

Courting developers, Facebook and offer interfaces, resources for the next generation of Web services
As Web ecosystems emerge, don't be surprised to see them overlap in new and interesting ways.

At last week's Salesforce conference, CEO Marc Benioff alluded to a Wall Street Journal report on an alliance between Salesforce and Google, without confirming anything. There may be something to the buzz: Salesforce previewed an ability to connect its APIs to Google's "to bidirectionally update Google spreadsheets," according to a report written by First Albany analyst Mark Murphy.

Google and Salesforce already do a lot of things together, says Nucleus Research's Wettemann. Many mashups on the Web have been created by Salesforce users tapping into Google Docs & Spreadsheets to incorporate stock updates and other financial data, for example.

Ultimately, all the development activity around Web ecosystems translates into a financial payday for the companies that get them right. Amazon, with 240,000 developers registered to use its services, sells more merchandise; eBay, seeing 50% of its merchandise loaded from software developed by third parties, completes more auctions; and Salesforce stands to license more software.

Social networking site Facebook opened its software to outsiders because there's more value from working with third-party developers than it could ever create on its own, says CEO Mark Zuckerberg. More than 65 developer partners have written software applications using Facebook's programming interfaces and a database tool called Facebook Query Language.

Last week, Facebook's f8 conference attracted 750 developers. Here's just one example of the kind of innovation they're after: Amazon has created an application that lets Facebook users write book reviews and publish them on their profile pages. Visitors viewing those pages and reading the reviews can click a "Buy at Amazon" button to make a transaction. The application relies on Amazon E-Commerce Service, which is part of Amazon Web Services. Amazon and Facebook are working on other applications along similar lines.

Yahoo held its first developer day last fall, where it sponsored a contest to see who could come up with the most innovative applications in 24 hours using its services. Such efforts represent a significant expansion of Web strategy.

"A massively popular social Web site is reborn as an operating system today," says Max Levchin, founder and CEO of social widget maker Slide.

EBay has transformed into much more than an auction site. It's a development hub, with 50,000 programmers using its APIs to connect sellers and buyers, tapping into PayPal for payments. Amazon has begun supplying developers with access to its data center infrastructure through programs such as Simple Storage Service and Elastic Compute Cloud. The flexible, scalable infrastructure that powers Amazon's retail business is being extended to outsiders as a readily available service.

Application ecosystems are a bold next step for established Web sites. "It's been on the project list since 2001," says Lee Thompson, VP and CTO of E-Trade, who envisions letting investors craft customized trading systems. "There are a lot of intelligent traders," he says. "These guys can program their own trading strategies if we could give them the tools, the APIs, and some examples of code" to get them started. However, E-Trade has been occupied with expanding the coverage of its site to six overseas exchanges, including those in Hong Kong, London, and Tokyo. So it has yet to build the software tools and programming interfaces that would turn investors into developers.

How might E-Trade do it? Thompson would apply lessons learned from open source projects, where a community forms around a common goal, troubleshoots mistakes together, and builds new systems by combining skills. With a modern scripting language such as Ruby, a programming framework such as Ruby on Rails, and easily constructed Web services, a developer community could be formed around E-Trade. The brokerage firm might begin with smaller brokerage houses that want to link to E-Trade. From there, it would be a hop and a skip to include individual, computer-literate investors, the CTO says.

New development tools are being offered to programmers who want to be a part of the new Web ecosystems. Microsoft last week said that even nonprofessional developers can use the company's Popfly mashup tool, which is still in test mode, and Visual Studio Express to build interactive applications for Facebook.

With tools, resources, and infrastructure available to them, developers will vote with their applications which software ecosystems--Facebook, Google, Saleforce--they want to support.

--With Thomas Claburn

Photo of bio-dome courtesy of Superstock

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Mary E. Shacklett, President of Transworld Data
James M. Connolly, Contributing Editor and Writer