Learn From Google Maps API And Just Have Standard Approach To Free And Paid Tiers For Your API From The Beginning
It has been almost 10 years since Google launched the Maps API. With as many APIs as Google have, you'd think they'd have a better handle on a standard approach to pricing across all of them. As we've seen with Google Translate, they have struggled with the right way of pricing APIs, as well as communicating this to their developer ecosystem.
In this new purchasing structure, the Google Maps Geocoding, Directions, Distance Matrix, Roads, Geolocation, Elevation, and Time Zone APIs remain free of charge for the first 2,500 requests per day, and developers may now simply pay $0.50 USD per 1,000 additional requests up to 100,000 requests per API per day. Developers requiring over 100,000 requests per day should contact us to purchase a premium licence.
It is good to see Google run with some pretty standard pricing, and running with something in line with what other API providers are putting to work. Just like Google worked to standardize OAuth 2.0 across the APIs, and get their approach to API management organized via the developer console, it looks like they are now working hard to get their API pricing in order.
I still see many API providers struggle with API pricing, both large and small. Many of the larger API providers do what Google did, and offer a free access level, and then once they need to generate revenue they shut things down, or tighten things up, rather than just offering a clear path to paying for resources. This approach has fueled the debate around whether you can depend on APIs, and also whether or not a freemium approach to APIs will work at all.
Another common stumbling block I see API providers trip over when it comes to pricing, is a disconnect between each level of access, meaning there is a freemium layer, and there are paid tiers of access, but there is no even steps between them, making it impossible for many developers to traverse. This generally makes a clear statement that it is ok to play with our API, but you really need to be the enterprise to actually do business with us.
This is all something that can be mitigated with a clear, pay as you go, pay for what you use API model with a free tier of access, and sensibly tiered paid levels of access, as well as a robust, transparent partner program for higher levels of needs. There are plenty of models out there to follow when crafting your own API monetization strategy, so make sure you something in place from day one, even if you are tweaking along the way like Google has had to do.