This paper investigates the structure and dynamics of the Web 2.0 software ecosystem by analyzing empirical data on web service APIs and mashups. Using network analysis tools to visualize the growth of the ecosystem from December 2005 to 2007, we find that the APIs are organized into three tiers, and that mashups are often formed by combining APIs across tiers. Plotting the cumulative distribution of mashups to APIs reveals a power-law relationship, although the tail is short compared to previously reported distributions of book and movie sales. While this finding highlights the dominant role played by the most popular APIs in the mashup ecosystem, additional evidence reveals the importance of less popular APIs in weaving the ecosystem’s rich network structure.