Oren Michels | Co-Founder & GM
August 11, 2011

Mashery's New Packaging and Pricing: Taking Volume Off the Table

 

When Kirsten, Clay, Scott and I started Mashery over five years ago, there was no such thing as a service for API management. Defining the initial product was easy, because we craved API management at our previous company (which was why we started Mashery), and we knew what we wanted.

But pricing was another story. We had no idea how to do it.

Initially, people compared us to ad servers, which historically charged by CPM. So we started there: at $0.35 per thousand API calls (our version of CPM), with a monthly minimum. That worked--until one of our customers blew way past the minimum. The overage bill would have been so huge that we tore up the invoice, reached out to the customer, and negotiated a new pricing schedule. After that, we tried many pricing variations, all of which were based on the premise that API call volume was a good proxy for the value we delivered.

But five years into providing full-service API management, we've learned that call volume is a lousy proxy for value, both for us and for our customers. After all, there are Mashery customers for whom a few dozen API calls result in big revenue transactions, while for others it takes thousands of calls to complete a single user session. And volume-based pricing leaves customers exposed to significant variable cost, whether it's calls per month, per hour, or per second. Furthermore, now that Mashery runs the world's largest multi-tenant API platform, we can easily handle a few million extra calls. Or a few hundred million. Or a few billion.

So over the past few months, our team has been looking at how Mashery customers use APIs, how they generate value from them, and how Mashery itself adds value. The result is a completely new pricing and packaging of Mashery services that, rather than volume, focuses on features and services that customers use.

The new program introduces three Mashery packages:

Accelerator Edition is for smaller companies looking to deploy API management.This is not some watered-down service. It includes everything you need to get going, and many more features and services than even our largest customers received just a few years ago. It does assume that your API is already standards-based and that you don't have to do things such as protocol translations, single sign-on, and outside integrations. But we found that few smaller businesses needed these services, so it made sense to leave them out and keep the price affordable.

Platform Edition is for larger enterprises building scalable distribution platforms. These companies typically have (or expect) more users and more developer partners, or they have fewer partners who generate a lot of value. Platform gets you global, full-service API management and a lot of extras, with up to 1 billion API calls per month. Which for all but the world's most highly trafficked API programs, essentially takes volume off the table. Plenty of customization is available, and extra features can be added a la carte.

Unlimited Edition is our top package, and it's for companies that run (or expect to run) highly trafficked distribution platforms. Unlimited customers have access to all Mashery features, with no API call volume limits. They also enjoy "big company" support, monitoring and SLAs, with Mashery tailoring plans to fit clients' needs. It's called Unlimited for a reason.

Of course, all Mashery customers continue to enjoy everything that has made Mashery the world's leading API management services provider. True multi-tenant architecture. Instant updates. Global fail-over between two independent networks (which, over the past few days, once again demonstrated its value). A secure, flexible developer portal with your look and feel. The awesome new Mashery I/O Docs. Access to our network of over 130,000 developers. Just to name a few.

Ultimately, it's Mashery's job to make API management a breeze (both operationally and technologically) so our customers can concentrate on their core business. We believe the new pricing and packaging lets us do that even more effectively, and we'll be working with existing customers to see if reworking their agreements under this new structure makes sense. Of course, we'll continue to refine pricing and packaging as we offer more services and receive more feedback from the marketplace.

Exciting times.

Oren