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Rajah Lehal

Why You Need an API License Agreement

November 15, 2015

Links from this article: Read the article here.

Some companies may open up their API to third party developers without an API license agreement (“going naked”), however this can cause problems and lead companies to later need to create a license and restrict what developers are doing. This article uses Twitter as an example. Twitter previously had given developers very liberal access to their API, but developers were using their API to duplicate their interface and compete with them, so Twitter made changes to its API Agreement.

The article points out that API license agreements are important because circumstances can change, and the Agreement can protect the API owner if changes need to be made to either the type of access developers have to the API, or to the API itself. It can also allow the owner to set the expectations and standards it has for apps developed by third parties. The Agreement usually contains terms that permit the company to unilaterally amend the Agreement at any time, as well as limitations on liablity.

Returning to the Twitter example, without an API license agreement containing limitations on liability and allowing it to make unilateral changes to the agreement and to developers’ access to the API, Twitter’s changes would have exposed it to lawsuits by developers who relied on the API for the continued existence of their apps and businesses .

Read the article here.Take away:

  • Having an open API without a license can lead to copy cats and new competitors for your business. This article outlines some of the benefits of having an API license agreement.
API
Grant of License
Commercial Activities

Written by Rajah. Rajah Lehal is Founder and CEO of Clausehound.com. Rajah is a legal technologist and technology lawyer who is, together with the Clausehound team, capturing and sharing lawyer expertise, building deal negotiation libraries, teaching negotiation in classrooms, and automating negotiation with software.