Almost everyone uses API on the web. From a company perspective, APIs allows to access data for others. A good example is when a shopping cart gives you the shipping rate from a delivery company. The API lets you send the shipping company information on the shopping cart and the company replies with the available quotes.
How do I know if I need an API?
If you are trying to create something that will need to have 2 or more programs exchanging information between each other, you will need an API.
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