Starting a tech company used to be hard. You needed lots of developers, lots of resources, lots of money and more money.

Then web APIs made it easier to start companies. ProgrammableWeb has at last count 861 APIs available for use, and 3257 mashups created using these. Now instead of creating your own map application for your rock concert website, you can use one of 88 mapping APIs available and slap your concert listings on top of that.

In the meantime, there was still one big hurdle for startups: deploying and maintaining a backend that could scale if the startup actually indeed succeeded. Not all startups hit millions of users but still, every startup had to be ready for the onslaught or they could kiss their exits goodbye. This required buying/leasing servers, architecting, rearchitecting and then maintaining clusters of servers, replacing burnt hard drives, backing up, adding more hardware as more customers showed up and keeping an army of sysadmins fed and appropriately caffeinated during the process.

Google and Amazon’s big advantage was their infrastructure. Especially Google’s big competitive advantage was their MapReduce/BigTable-based seemingly-infinitely-scalable infrastructure that could support huge amounts of traffic and data, running on low-cost hardware.

Amazon opened the flood gates to offering this big competitive advantage to any company in the world by becoming the book store that sold cocaine out the back door. As Larry Dignan said “Books will be just a front to sell storage and cloud computing”.

Not a day goes by now without an announcement from another industry giant (Intel, HP, Yahoo, IBM, Verizon, AT&T) offering scalable compute clouds. Dell even tried to trademark the term ‘cloud computing’.

Now that cloud computing is going through what web APIs has gone through, it will be interesting to see if the competitive advantage for startups will be purely innovation now that all startups will be able to scale their service without a huge amount of investment and resources.