“APM Game Changer” was the headline yesterday with the news that Compuware acquired Dynatrace Software for $256 million. With the APM market worth an estimated $6 billion, it’s not really a surprise to see such a transaction (no pun intended) within the APM market. In fact, over the past ten years, there have been several large transactions made by established IT vendors trying to claim a piece of the APM market.
If we take a look at several of those APM acquisitions (specifically Deep Dive) and present the facts, you can draw some interesting conclusions.
The first obvious conclusion is that Compuware has acquired two Deep-Dive APM tool sets in the last 7 years. In response to a question on the Compuware Investor Relations call yesterday, Compuware’s CEO made it very clear that Dynatrace will replace the Vantage Analzyer (Devstream) product – giving evidence to the fact that a) Dynatrace and Vantage Analyzer have 100% overlap and b) Vantage Analzyer did not keep up with the market requirements for APM. Compuware’s CEO, Bob Paul, even referred to Vantage Analzyer as “one of a set of commodity APM tools on the market.”
So why did Compuware buy Dynatrace? The answer is simple – application development technologies and architectures haven’t stood still. The first generation APM toolsets (listed above) were written at the turn of the century to support relatively simple, monolithic 3-tier architectures where application logic was nicely packaged in a simple cluster of JVMs/CLRs running on one or two powerful servers. Enterprise Java/.NET applications were relatively new; early versions of J2EE were notoriously complex and organizations for the first time could see inside their applications.
A year after Compuware acquired DevStream (2004), a new wave of technology, trends, and practices were about to re-write the rulebook of modern day application architectures. Whilst many large software vendors were busy acquiring APM technology, many simply missed the challenges that Service Orientated Architectures (SOA), Utility Computing, and Virtualization were about to create. The likes of VERITAS Software, CA and HP chose APM integration over innovation; subsequently, they struggled to deliver new capabilities and periodic releases to the market, which a vendor like Dynatrace, founded in 2005, was able to exploit.
In 2006, SOA gathered pace and caused Application logic to become distributed to the point where a single business transaction could traverse 10+ tiers before it finally delivered a response back to the end user. This was a key challenge and shift for APM; this distributed complexity required a transaction perspective to address the visibility challenges of SOA. The problem was that nearly all-first generation APM technology was architected around transactions executing inside a single JVM rather than across multiple JVMs or tiers. To compound this SOA shift, Utility Computing came knocking around 2007 with the concept that applications would share common/pooled infrastructure and services (known as the utility or grid) to enable greater agility for the business at lower cost. Utility computing demanded that APM solutions monitor thousands of JVMs/CLRs across hundreds of physical servers (the utility), pushing the scalability limits of APM vendor architectures. For the APM vendor focusing on integration (know as the APM suite), it was a massive uphill challenge to re-architect and scale to be able to monitor >200 nodes.
- Cloud Computing – IaaS and PaaS means application logic will once again become more distributed and virtual across multiple servers, data centers, and providers. For an application to leverage the benefits of the cloud, its underlying architecture and technology needs to be elastic so it can consume IT resource on the fly as it’s provisioned. APM has to once again adapt and manage this shift so it can provide visibility of where and what the application and its performance looks like at any given period of time.
- Agile Methodology – A decade ago one or two releases a year was the norm for most organizations. Today, some organizations are doing ten or twenty releases a day. If application code bases are changing daily, how does APM keep up and know what parts of an application to monitor? Organizations can’t wait to re-configure their APM solution for every agile release; APM must adapt and provide required visibility without human intervention.
- Big Data – Online user and transaction volumes are rapidly increasing each day; data management is becoming critical to ensuring application performance and end user response times are not impacted. APM needs to innovate and keep up with new technology shifts like NoSQL and data caches to provide visibility of application performance beyond traditional relational databases.
- SaaS – Software as a Service is becoming more and more accepted (and perhaps preferred) by software buyers because of the reduced cost-of-ownership and elimination of hardware and system software maintenance. None of the legacy deep-dive APM solutions listed above, including Dynatrace, provide a SaaS deployment option.
As organizations become more agile and innovate with new ideas and technology, it’s down to the APM vendors to follow suit, so they can stay relevant. Application architectures and methodologies won’t stand still or wait for APM technology to catch up. It’s a train that simply won’t stop. One of the major industry analyst firms made this point strongly when they made the predication that “less than 50% of the APM vendors” will keep up with the shifts in application architecture.
So what does this mean for APM Buyers in 2011?
1) Be informed. Study the list above to understand the genesis of the acquired solutions.
2) When evaluating APM solutions, make sure they can support your application architecture today. Put your prospective vendors through rigorous tests. View our “Key Questions to ask APM Vendors” matrix.
3) And finally, make sure they have the R&D focus to keep up with architecture changes you may make over the next 3 years. If they don’t have releases planned for every 6 months or sooner, they may not be the right vendor.
AppDynamics, founded in April 2008, is the leading APM solution for organizations with modern application architectures – those that are highly distributed, agile, and dynamic. Our R&D team is 100% dedicated to APM and delivers product innovation every 3-4 months. In the last three months, we’ve added support for many technologies that are being adopted in 2011, such as NoSQL and Big Data technologies. We’ve been leading the way on monitoring cloud applications with marquee cloud customers like Netflix, where we monitor the 1000’s of Amazon AWS nodes that power their mission-critical Netflix.com site. We’re also the only deep-dive APM solution that offers both SaaS and on-premise deployment options. And you don’t have to take our word for it: join the 35,000 users and download our free product, AppDynamics Lite, to see how we can help you.
Looking at APM over the past decade, it’s increasingly clear that those who innovate succeed, and those who acquire products but stop innovating quickly fall behind.