May 13, 2004

PayPal API release aimed at Web services, OS developers

Author: Jay Lyman

In an effort to help higher-level developers build payment and transaction functions into their Web sites and applications, PayPal has released a suite of free APIs that the eBay-owned company claims will enable more streamlined and automated access to its platform.

PayPal Developer Network director Dave McClure told NewsForge the initial three API calls are just the beginning of a series of APIs the company will release over coming quarters.

With the initial PayPal Web Services in beta form, PayPal is providing TransactionSearch, which is based on specified search criteria, such as payment date or customer name and returns a set of matching transaction IDs and details; GetTransactionDetails, which returns all details -- email, time of payment, etc. -- associated with a given transaction; and RefundTransaction, to reverse transactions and issue partial or full refunds. MassPay, an API to be available next month, transfers funds to one or many recipients by providing an automated alternative to cutting paper checks or manually initiating individual payments.

Trying to reach more sophisticated developers

McClure referred to previous PayPal developer outreach efforts and toolset opening such as the Instant Payment Notification (IPN) interface -- for handling real-time purchase confirmation, server-to-server communications, download management, and user login among other services and communications. He said the newest APIs came about as a result of parent company's similar moves last year-- which amount to Web services offerings with the same common API structure -- and a desire to reach more technical, enterprise-level developers.

"It's more of an experience and size question," McClure said of the target for the new APIs. "We're trying not to focus on one specific platform for developers. We're trying to focus on the platforms developers are using."

While the majority of work is expected around Microsoft's Visual Studio and Java on Sun or BEA, McClure said PayPal is building on existing work with open source platforms and communities, such as Zend. McClure said there were fewer open source tools available to work from and that PayPal is just trying to get out to the various platforms at this stage.

"The same kind of work we're seeing in Java and .Net -- we're trying to extend that out to the open source community," McClure said, referring to work with Perl and other open source projects. "There are still a few hurdles."

Another reason for the new PayPal APIs was demand for the SOAP and WSDL-supporting interfaces from a growing audience of developers, according to McClure.

"We've definitely seen a lot more adoption among more sophisticated developers, and they were asking for more tools," McClure said.

Developers were also asking for the newly announced PayPal Sandbox, a part of PayPal Developer Central intended to allow developers to test PayPal solutions before deploying them.

Want a testing environment? You've got it

"People were always complaining about wanting a testing environment," McClure said. "Now they can simulate account creation and management, simulate purchases or funds transfers. It's really a much broader offering for them to test all of that functionality."

McClure added that this month's PayPal Web Services API release covered the "core" APIs that will be added to, but are "pretty powerful already."

Gartner research director Whit Andrews said that PayPal was looking to ease the ability of Web site and software developers -- particularly financial software -- to integrate PayPal capabilities into their work.

"Essentially, they are seeking to expand beyond the idea of 'email me money,' to 'use your preferred means to get money to someone,' " Andrews said.

The analyst added the PayPal APIs are significant in that they carry transactional duty, which while not unprecedented, is unusual.

"They will aid PayPal in extending capabilities beyond those inherent to its own Web site," Andrews said.

Andrews also highlighted the importance of the PayPal APIs basis in open standards.

"Such APIs grow substantially in value when they use open standards, because the time it takes for developers to learn them is reduced," Andrews said. "Also, developers may be assured that adopting the APIs is less risky. The use of standards to define the APIs substantially increases the likelihood they will be broadly adopted."

PayPal's McClure said the time was right for the new APIs also because Web services standards are becoming more formalized and more widely used.

PayPal getting into Web services big time

Yankee senior analyst Phil Fersht said he agreed that there is more Web services adoption taking place -- both at the edge and at the front end -- and PayPal's API release is an effort to get in the game.

"Why companies like PayPal are providing these is to bring themselves into the Web services jigsaw," Fersht said. "They want fit into a service-oriented architecture, and they're going after the larger vendors like HP, Sun, VA, and Oracle."

Fersht added software vendors such as Macromedia that actually develop Web services may also benefit from PayPal's APIs, which bring critical billing capabilities to the mix.

The analyst also said PayPal's compatibility with Web services security standards could make or break its strategy with the APIs.

"We'd have to wait and see who they've committed to with partners, but if they have a billing and payments system that incorporates the security challenges of Web services and provides communication between applications in a secure environment, then they've on to a winner," Fersht said.

McClure said after reaching graphic designers and Web site developers, PayPal is now looking to the "third level" of more traditional hardware and software developers with a goal of allowing wizard-based creation of payment and related capabilities. PayPal now offers payment button creation through PayPal wizards for Macromedia Contribute and Dreamweaver MX, Microsoft FrontPage and Visual Studio .Net, NetObjects Fusion, Macromedia Flash MX, and Adobe GoLive!

McClure said work with open source projects, including Source Forge projects that rely on PayPal to take donations or pay developers, will continue.

"We've seen a lot of interest from the community," he said.

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