How to license and monetize API?

[r-brown]

Question

Our company offers RESTful API for the customers.
We want to offer this API in a free tier as well as paid enterprise version with an extended feature set and SLA.
How we can use licensing services to achieve this?

[r-brown]

API licensing is just the same as license regular applications, SaaS or IoT devices. API functionality or even access can be restricted based on the NetLicensing validation response for a particular API caller by its username, APIKey or other IAM identifier.

Basic message flow:

• API user (caller) sends an API request to the vendor's endpoint and provides auth data, such as login name, API Key, etc.
• API's backend system uses auth data to verify user's entitlements at NetLicensing
  • NetLicensing customer profile should match requested login data (e.g. via Licensee Number or Alias)
• NetLicensing's validation response will need to be parsed and user entitlements verified
  • (optionally) It's recommended to cache validation response to improve API performance
• An appropriate response should be delivered to the user
  • HTTP200 + API response data in case of successful user validation
  • HTTP429 + "Quota Exceeded" status message in case of failed or expired validation