Magic Quadrant for

Observability Platforms
12 August 2024- ID G00798774- 52 min read
By Gregg Siegfried, Padraig Byrne, and 2 more

Observability platforms convert telemetry into insight and action using analytics,
visualization, automation and increasingly, AI. Most include application performance
monitoring capabilities, but APM is not enough. I&O leaders can use this research
to explore these vendors and solutions.

Market Definition/Description
Gartner defines observability platforms as products that ingest telemetry
(operational data) from a variety of sources including, but not limited to, logs,
metrics, events and traces. They are used to understand the health, performance
and behavior of applications, services and infrastructure. Observability platforms
enable an analysis of the telemetry, either via human operator or machine
intelligence, to determine changes in system behavior that impact end-user
experience such as outages or performance degradation. This allows for early, and
even preemptive, problem remediation. Observability solutions are used by IT
operations, site reliability engineers, cloud and platform teams, application
developers, and product owners.
Modern businesses rely heavily on critical digital applications and services, which
are revenue-generating, client-facing and important to the efficient operation of the
business. Outages, performance degradation and unreliability directly impact top-
line revenue, client sentiment and brand perception.
Observability platforms are used by organizations to understand and improve the
availability, performance and resilience of these critical applications and services.
Investment in and successful deployment of observability platforms leads to
revenue loss avoidance and enables faster product development cycles and
improvements in brand perception.
Example use-case scenarios or business problems addressed by observability
platforms include:

• IT operations: IT operations teams responsible for live production

environments are tasked with ensuring that applications and services are
available, responsive and performant at all times, and especially during
periods of high demand. Observability platforms allow these teams to be
alerted when issues are detected, and make it possible to interrogate the
data to identify the underlying cause.
• Platform engineering: Platform engineers’ use of observability platforms
resembles that of IT operations as well as software development.
Observability platforms help these teams ensure that production
environments consistently meet service-level objectives, in addition to
supporting data-driven continuous improvement and platform evolution.
• Software development: Development teams use observability platforms as an
integrated part of the CI/CD pipeline, providing rapid feedback on new code
deployments. This enables faster delivery of new features, as well as
improved product resilience.
• Business analyst: Business analysts may use observability platforms to
understand and analyze key business metrics. These metrics are often
specific to the organization and client (for example, a retailer measuring the
cost of abandoned shopping carts and average customer spend).

Mandatory Features
At a minimum, observability platforms must:

• Ingest, store and analyze operational telemetry feeds, including (but not
limited to) metrics, event, log and trace data.
• Identify and analyze changes in application, service or infrastructure behavior
in order to determine availability outages, performance degradation and/or
impact on end-user experience.
 • Enrich telemetry by providing contextualization in the form of both
topological dependency mapping and the relationship with and between
business services.

Common Features
The common features for this market include:

• Monitoring of digital experience of applications and services delivered via

browser, mobile app and API.
• Integration with other operations, service management and software
development technologies such as IT service management, configuration
management database, event and incident response management,
orchestration and automation, and DevOps tools.
• Telemetry collection from public cloud providers (such as Amazon
CloudWatch, Microsoft Azure Monitor and Google Cloud Operations).
• Ability to perform interactive exploration and analysis of multiple telemetry
types (such as traces, metrics and logs) to generate insights about user and
application behavior.
• Providing insights through the use of advanced analytics and machine
learning that are otherwise not possible or feasible to derive through manual
interrogation and analysis of data.

• Automated discovery and mapping of related infrastructure, network and

application components and services.
• Cost management that supports measuring and optimizing application
workload cost, and/or measuring and optimizing observability platform
utilization or spend.
• Business process and activity monitoring reflecting user journeys such as
login to check-out, funnel analysis to track conversion rates, customer
onboarding or loan application.
• Application security functionality, such as the identification of known
vulnerabilities in monitored applications and the ability to block attempts to
exploit them.
Magic Quadrant
Figure 1: Magic Quadrant for Observability Platforms

Vendor Strengths and Cautions

Amazon Web Services

Amazon Web Services (AWS) is a Challenger in this Magic Quadrant. Its

observability solution, which comprises Amazon CloudWatch, AWS X-Ray, Amazon
Managed Service for Prometheus, Amazon Managed Grafana and AWS Distro for
OpenTelemetry, enables end-to-end observability use cases. This set of services is
part of AWS Cloud Operations, which also includes governance and financial
management. Its operations are geographically diversified, and its customers tend
to be large enterprises. AWS releases and announces product updates regularly.
Strengths

• Application Signals: In late 2023, AWS introduced CloudWatch Application

Signals, the first CloudWatch service centered on monitoring applications.
Application Signals allows operators to manage health and performance, and
perform triage, by establishing service-level objectives (SLOs) and navigating
subsystems and dependencies using service maps.
• Unified observability: Support for industry standards like OpenTelemetry,
Prometheus and Selenium facilitates interoperability and reuse. Although
agents are available to collect telemetry, they are not required to do so.
Workloads outside AWS can be monitored, and telemetry from a variety of
sources visualized using the Managed Grafana service.
• Geographic footprint and distribution: AWS has a substantial global reach
and continues to expand, with four new regions publicly announced, as well
as 18 new local zones. As the observability services are available
everywhere, customers can decide how and where to store telemetry across
its life cycle.
Cautions

• Competitive dynamics: The AWS observability tools have markedly improved

in recent years with the introduction of capabilities like CloudWatch
Application Signals and Internet Monitor. But AWS also acts as the host for
many of the other vendors represented in this research and partners with
them for sales via the AWS Marketplace. This push-pull relationship is at
odds with the aforementioned unification but prioritizes customer choice over
time.
• Cost management: As with most AWS services, observability is a pay-as-
you-go offering based on a variety of consumption levers that may not line
up exactly with your operating model or use cases.
 • Offering complexity: Depending on how they are counted, there may be
between eight and 28 monitoring and observability services available from
AWS. Although this represents an impressive diversity of products, it also
remains a source of confusion for customers. Improved documentation has
been helping customers distinguish CloudWatch components by use case
and capability.
BMC

BMC is a Niche Player in this Magic Quadrant. The BMC Helix Operations
Management platform delivers a range of ServiceOps and observability capabilities
and consists of several products, including BMC Helix Discovery and other
components. BMC has a significant presence in the adjacent IT service
management market with its BMC Helix ITSM (formerly Remedy) product, as well as
its mainframe solutions. BMC’s operations are globally distributed, with presence in
all major markets.
Since the commencement of this research, BMC announced the acquisition of
Netreo, an infrastructure, network and application observability vendor. Netreo was
not evaluated as part of this research.
Strengths

• Broad installed base: As one of the traditional “Big 4” IT operations

technology providers, BMC has significant presence in many large
enterprises and government agencies. Its experience delivering at this level
and familiarity among existing clients present a potentially easier transition
into observability.
• Service operations: Although designed to coexist with third-party tools,
BMC’s approach integrates its own ITSM, discovery and CMDB tools with
the observability solutions, opening the potential for significant tool and
vendor consolidation.
• Investigation tools: The solution includes a health timeline and health score,
which are useful in understanding recent changes in performance of the
application or service under observation, as well as enabling quick visual
checks on what changed. It also has a “Situation Explanation” capability,
 which uses a number of composite AI technologies, including BMC
HelixGPT, to help explain the likely cause of the issue.
Cautions

• Portfolio complexity: BMC’s full solution draws on many different

components from its portfolio, although individual capabilities can be
licensed separately. Demonstrations of functionality relied in some cases
upon custom-generated dashboards, with functions such as SLOs not
available out of the box.
• Pricing model: BMC does not make list pricing available publicly, outside of
government and cloud marketplace pricing. This is not in line with the trend
in the observability space, where clients prefer early access to pricing in
order to build cost models and pricing estimates.
• Existing BMC environments: Much of the BMC customer base
uses earlier BMC technologies, such as BMC PATROL and TrueSight. BMC
has made investments to modernize its portfolio, such as the cloud-native
Helix platforms, as well as the acquisition of Netreo. As such, clients will
need clear guidance on the most effective upgrade path for these solutions.
Chronosphere

Chronosphere is a Leader in this Magic Quadrant. Its observability platform solution

comprises the Chronosphere Observability Platform and the Chronosphere
Telemetry Pipeline. Its operations are mainly focused in the U.S. and EMEA, and its
customers are concentrated in North America.
The founders of Chronosphere created the M3DB time series database while
working at Uber, and Chronosphere continues to champion that open-source
project today. Recent activities include the acquisition of telemetry pipeline vendor
Calyptia — also the creators of Fluent Bit — and a partnership with CrowdStrike
that forms the basis of its log ingestion and analysis products.
Strengths

• Ingestion controls and governance: Chronosphere includes a control plane

that enables customers to analyze telemetry usage and establish policies and
rules for shaping and sampling data at ingestion time. These controls
 support observability cost optimization and data governance in a way that
few other vendors currently can.
• Open-source-based: Chronosphere supports Prometheus-style collection for
metrics and OpenTelemetry for metrics, logs and traces. This facilitates
migration for organizations that no longer wish to manage their own
Prometheus or Jaeger environments. The Calyptia acquisition brings another
open-source tool, Fluent Bit, as well as telemetry pipelines into the
Chronosphere portfolio.
• Single-tenant architecture: Customers of Chronosphere are provisioned into
their own tenant with private storage. This reduces the chance of resource
contention between customers and offers an additional layer of security.
Cautions

• Geographic footprint: Although the service is available globally,

Chronosphere’s delivery platforms are currently hosted in U.S.-based public
cloud regions only. This may pose a data sovereignty concern for some and
a latency concern for others. A hosting presence in EMEA is planned for
2024.
• Digital experience monitoring: Chronosphere currently offers no specific
digital experience monitoring (DEM) capabilities, such as synthetic
monitoring services, or support for inserting real user monitoring
(RUM) instrumentation into browser-based or mobile
applications. DEM telemetry can be ingested, analyzed and visualized using
Chronosphere, just as with any other metrics, events, logs and traces
(MELT) telemetry, but generating it and getting it to Chronosphere is a
customer responsibility.
• Not self-instrumenting: Chronosphere does not include an agent, so
monitored workloads must be instrumented in a manner compatible with
Prometheus or OpenTelemetry, or by using a Fluent-Bit-supported format.
Chronosphere has built support for ingesting telemetry from the agents of
several competing products, so it may be possible to make use of one of
those if the most common formats are not available.
Datadog

Datadog is a Leader in this Magic Quadrant. Its SaaS platform offers observability
and cloud security. Its operations are mainly focused in the U.S. and EMEA, with an
expanding presence in APAC and Latin America. Its clients range from startups to
large enterprises. Its recent developments include improved dashboards,
notebooks and watchdog AI features on the Datadog platform, and the introduction
of Flex Logs, Mobile App Testing, Data Streams Monitoring and Dynamic
Instrumentation. It has also launched Event Management for correlating events from
Datadog and other observability tools into one unified view.
Strengths

• Overall vision and sales execution: Datadog has rapidly built many new
capabilities in APM, log management, DEM, security and software delivery. It
resonates well with enterprises looking for best-of-breed solutions. The
company’s product-led growth (PLG) model has been successful in growing
the size of its customer base and expanding customer engagement
throughout small and large organizations.
• Visualization: Datadog’s user-friendly visualizations allow users to view all the
telemetry in a single pane. It also has widgets for easy customization of
dashboards.
• Product roadmap: Datadog has a strong product roadmap to improve
observability, DevSecOps, automation and remediation, software delivery,
and governance of telemetry. Its strategy is to have a platform that ties
everything together.
Cautions

• Pricing: While Datadog provides detailed pricing on its website, some

Gartner clients have raised concerns about spend spiraling quickly out of
control as usage grows. To address this, Datadog offers configurable
ingestion controls to help customers remain within budget.
• Business model: Datadog’s portfolio has grown significantly in recent years,
and it now has 20 separate product lines on its website. Each module has its
own pricing structure, which can make pricing proposals confusing to
 understand and negotiate. Datadog has begun to roll out bundled product
offerings to simplify price.
• Fleet management: Datadog’s lack of agent fleet management and
automated deployment can add complexity to large installations. The
company claims these capabilities are under development and in beta status
today.
Dynatrace

Dynatrace is a Leader in this Magic Quadrant. Dynatrace’s observability and

security platform comprises multiple components, including Infrastructure and
Application Observability, Security Analytics and Protection, Digital Experience,
Automations and Business Analytics. Dynatrace has clients in all major
geographies, including Latin America and APAC. Its customers tend to be large
enterprises and technology-centric companies. Dynatrace recently acquired
developer tools vendor Rookout and security vendor Runecast.
Strengths

• Portfolio breadth: Dynatrace offers a wide array of solutions for observability

and security, making it particularly attractive for larger enterprises. This
includes observability for modern architectures such as Kubernetes,
containers and cloud functions, as well as monitoring for legacy enterprise
solutions, such as mainframe and SAP monitoring.
• AI advancements: Dynatrace has delivered enhancements to its Davis AI
engine. The “hypermodal” approach from Dynatrace embraces the use of AI
across its platform, for causal and predictive modeling, as well as deploying
new AI assistant technologies using generative AI.
• Platform extensibility: For those looking to generate insights beyond health
and performance monitoring, Dynatrace’s AppEngine and AutomationEngine
broaden the platform’s capabilities by enabling customers and third parties
to create custom apps and automation tailored to industry- or business-
specific use cases.
Cautions
 • Purchasing complexity: Dynatrace Platform Subscription (DPS) was
introduced in 2023 as a new subscription-based pricing model, with an
annual minimum commitment and a drawdown rate card. Many clients have
readily adopted this new model, which enables access to any Dynatrace
product. However, some procurement departments have been more cautious
as they carefully consider the implications of the minimum commitment, the
subscription model and access to new Dynatrace components.
• Slow log adoption: In 2023, Dynatrace released a mechanism for ingesting
large volumes of logs. While clients are interested in using this technology to
centralize observability data in one platform, Gartner has not seen significant
uptake of Dynatrace for bulk log ingestion and analysis.
• Suitability for SMBs: Dynatrace is a fully featured observability platform
primarily targeted toward enterprises. While alternative channels such as
public cloud marketplaces make it more accessible, small and midsize
businesses may find that cost justification limits Dynatrace use to monitoring
the most business-critical systems.
Elastic

Elastic is a Leader in this Magic Quadrant. Elastic Observability is built on a

foundation of its popular Elastic Search AI Platform, formerly known as
Elasticsearch, which also underpins its Search and Security products. Elastic
Observability can be delivered via SaaS or as self-managed. Headquartered in
North America, Elastic’s customers are primarily in the Americas and EMEA, with
growth in APAC. Elastic’s roadmap includes enhanced analytics and site reliability
engineering (SRE) productivity, based on its new query language and AI assistant
capabilities.
Strengths

• Broad AI integration: Elastic has embedded AI across its platform. Elastic

Observability offers over 30 ML models, custom model integration, and an AI
assistant based on retrieval-augmented generation (RAG) that enhances
traditional AI and data analytics.
 • Open and flexible: Elastic Observability benefits from its roots in the open-
source Elasticsearch data platform, with the ability to ingest, transform and
analyze heterogeneous, high cardinality at scale. Its open architecture
facilitates an extensible and flexible platform.
• Deployment model versatility: Elastic Observability is globally accessible
across multiple regions, encompassing all major cloud hyperscalers, and also
offers a self-hosted alternative with a largely comparable feature set. This
versatility addresses the requirements of clients who prioritize data
sovereignty and adherence to regional statutory regulations, inclusive of
FedRAMP certification for U.S. governmental bodies.
Cautions

• Market awareness: While its Search and Security products are relatively well-
known, awareness and adoption of Elastic Observability are lower. Elastic is
still building sales and marketing traction for its observability offering.
• Learning curve consideration: Open-source software is often associated with
a steep learning curve, which may impact time to value. Elastic Cloud
simplifies adoption, but organizations planning to self-host should ensure
that sufficient skills are available.
• Pricing estimate: In contrast to other vendors in this market, Elastic bases its
pricing model on compute resources. Although Elastic offers a pricing
calculator, comparison during procurement or review, and during forecasting
of costs and budgets, can be challenging.
Grafana Labs

Grafana Labs is a Leader in this Magic Quadrant. Grafana Labs was founded
around the popular open-source project Grafana. The company has launched other
open-source projects, such as Loki, Tempo, Mimir, Beyla and Faro. Grafana Labs’
observability platform comprises Grafana Cloud Visualization, Grafana Cloud
Metrics, Grafana Cloud Logs and Grafana Cloud Profiles, along with Grafana
Machine Learning. Its customers are global, but centered in the Americas and
EMEA.
Recent activities include the acquisition of application behavioral insights vendor
Asserts, the release of an SLO management solution, and a suite of cost
management tools.
Strengths

• Geographic and hosting diversity: Grafana Cloud is hosted in 19 AWS,

Microsoft Azure or Google Cloud Platform (GCP) cloud regions globally at
time of writing. This impressive footprint enables customers to choose a
location based on their latency challenges and data sovereignty needs.
• Delivery cadence: Grafana Labs has substantially increased the capabilities
of Grafana Cloud over the last 12 months. Notable items include application
and front-end observability, SLO management and Adaptive Metrics, which
supports aggregation or discarding of time series data, rather than ingestion
of it, as a cost management technique.
• Composability: Grafana’s ability to connect to other telemetry collection
repositories and integrate data visually without moving it or requiring that it
be stored in Grafana Cloud enables a composability that is difficult to
duplicate with other solutions. Beyond visualization, alerts can be triggered
based on telemetry collected elsewhere or on a set of conditions that
crosses tool boundaries.
Cautions

• Learning curve: As more tools and capabilities are added to the “logs,
Grafana, traces, metrics” (LGTM) stack, the more challenging it becomes to
master. Configuration often requires manual editing of YAML or JSON, and
although documentation is available, it tends to be reference-oriented and
not geared toward the beginner.
• Cost predictability: New Grafana Cloud users may struggle to predict their
potential spend on metrics in particular, as “active series” and data points
per minute may not be measurements they can easily obtain. Use of the
Grafana Cloud free tier may help mitigate this.
• Revisiting “co-opetition”: A previous iteration of this research identified the
potentially uneasy relationship that Grafana Labs has with other vendors of
 observability solutions. This is still a concern, particularly as Grafana Labs
grows. Maintaining partnerships with AWS, Google and Microsoft for
“managed Grafana” services may act as a buffer between Grafana Labs and
competitors, but is something to be aware of.
Honeycomb

Honeycomb is a Visionary in this Magic Quadrant. Honeycomb’s service comprises

a data store and query engine optimized for exploratory identification and
investigation of patterns and anomalies in application and infrastructure telemetry.
Honeycomb is an observability platform that supports APM use cases and is
delivered as a SaaS product. Its clients are global, but are concentrated in North
America and EMEA.
Recent updates include Honeycomb for Kubernetes and Honeycomb for Frontend
Observability (in early access at time of writing).
Strengths

• Kubernetes accelerators: In 2023, Honeycomb announced Honeycomb for

Kubernetes. This dedicated solution allows SREs to rapidly identify issues
within containerized environments.
• Engaged client base: Honeycomb as a vendor maintains strong connections
with its user base, with many opportunities to listen to feedback directly from
clients. It provides frequent workshops, an active Slack community and
frequent engagement on social media.
• Geographic presence: In early 2024, Honeycomb announced the deployment
of a new SaaS-based instance in Europe. This allows clients to decide
whether to send their observability data to the U.S., the EU, or both, allowing
them to adhere to local data sovereignty regulations.
Cautions

• Enterprise market traction: Although popular with technology creators and

cloud-native organizations, Honeycomb has gained limited traction in the
broader enterprise. Gartner clients rarely shortlist Honeycomb as a vendor for
their observability platform.
 • Technical focus: Honeycomb’s messaging targets and resonates strongly
with technical specialists, such as SRE and platform teams. This can
overshadow its ability to deliver customer and behavioral insights, which may
be what the budgetholders in I&O need to hear.
• Pricing predictability: Honeycomb’s pricing is based on event volume
ingested into the platform. For clients, estimating the number of events, as
well as predicting the growth over a 12-month period, is challenging.
IBM

IBM is a Visionary in this Magic Quadrant. IBM’s Instana observability platform is

offered as both a SaaS and self-hosted solution and uses a single-agent
architecture. Its operations are mostly focused in North America and Western
Europe, with a smaller number of clients in other regions. Its client base is midsize-
to-large enterprises. IBM’s monitoring portfolio includes mainframe, as well as
modern cloud architectures. IBM recently announced its intention to acquire
HashiCorp, an infrastructure automation company. HashiCorp’s product Terraform
frequently integrates with observability platforms.
Strengths

• Precision telemetry: Instana collects metrics at one-second resolution and

claims that notifications will be generated in three seconds. Taken together,
these can contribute to improved availability and SLO adherence.
• Pricing model: IBM Instana continues to offer an easy-to-understand pricing
model, based on a per-host metric, and is competitively priced in the market.
• AI integration opportunities: Instana provides automated observability and
applies AI for insight generation and decision making. Instana provides
expert knowledge, performs diagnostic and remediation actions, and helps
rapidly resolve incidents. Recently, IBM launched watsonx and Concert, both
built with generative AI, which provide opportunities for integration.
Cautions

• Limited security tools: Instana has limited offerings around security use
cases, relying on other parts of the IBM portfolio to provide this functionality.
While Gartner defines security as an optional capability for observability
 platforms, clients should evaluate their own needs regarding an integrated
solution.
• Market awareness/sales strategy: IBM Instana is rarely mentioned in calls
with Gartner clients, either as an incumbent solution or as a shortlisted
vendor. Existing IBM clients are often unaware of Instana, even when they
are looking for an observability solution. While IBM does have an upgrade
path to Instana for those clients on legacy IBM IT operations tools, clients
may be unaware of it.
• Log ingestion: Instana’s log ingestion capabilities are limited to application
logs and containerized environments. Extending to wider environments is
part of its 2024 roadmap.
LogicMonitor

LogicMonitor is a Visionary in this Magic Quadrant. LogicMonitor has evolved from

hybrid infrastructure monitoring to observability with the LM Envision platform. Its
agentless SaaS platform includes infrastructure monitoring, network, SD-WAN,
cloud monitoring, and application monitoring with AI capabilities. Its customers are
mainly from the Americas and EMEA, with an expanding presence in APAC.
LogicMonitor has made several releases in the last one year, including tools such as
Edwin AI for cross-domain event ingestion and event correlation; LM Copilot, the
GenAI chatbot; and LM Cost Optimization for managing cloud costs.
Strengths

• Scalability: LogicMonitor uses agentless collectors installed on hosts that are

physically close or on the same network as the resources being
monitored. The number of collectors is aligned to the telemetry to be
collected and to the capacity of the server on which the collector is installed.
The collectors can handle high volumes of data through automatic balancing
across a cluster of collectors, thereby sharing load and supporting failover. It
offers a 99.9% SLA to its customers in terms of availability of the platform, to
ensure monitoring is available at all times.
• Container support: LogicMonitor has extensive support for containers. It
provides an optimized collector for all Kubernetes (K8s) environments that is
 Container Runtime Interface (CRI)-agnostic. This enables monitoring without
requiring any modifications to the container code.
• Straightforward pricing: LogicMonitor offers simple and competitive pricing
that supports enterprises of nearly any size. It is also suitable for
organizations offering services to other businesses in a managed service
provider (MSP) model.
Cautions

• Limited emphasis on observability key capabilities: LogicMonitor is still very

infrastructure-focused. Most Gartner client inquiries about LogicMonitor are
on infrastructure and network monitoring. Despite recent investments,
LogicMonitor lags behind in some capabilities, like DEM, vulnerability
and threat detection, compared to its peers in this research.
• Visualization and dashboards: Although LogicMonitor provides many out-of-
the-box monitoring templates, the UI has lagged those of Leaders in the
market. LogicMonitor has begun to release a new user interface, which may
address this. Multiple clicks are often required to analyze the telemetry and
relationships, and to put data in context.
• Market reach: LogicMonitor has put significant effort into marketing around
observability. While its vision incorporates hybrid coverage and integrated AI,
its messaging and marketing have not yet translated to growing market
considerations, based on Gartner inquiries.
Logz.io

Logz.io is a Visionary in this Magic Quadrant. Its Open 360 observability platform is
based on a foundation of open-source technologies hosted as a SaaS solution
across multiple cloud providers. Capabilities include application, Kubernetes and
infrastructure monitoring; log management; and a cloud security information and
event management (SIEM) solution. Logz.io’s customers are typically open-source-
friendly, small-to-midsize enterprises in the Americas and EMEA. Its roadmap
includes further enhancements leveraging generative AI, and business-centric
features such as SLO management.
Strengths
 • Telemetry cost management: Logz.io is focused on providing cost-effective
observability. Its Data Optimization Hub provides a powerful telemetry cost
management layer. Its features include telemetry filters with
recommendations, tiered data storage, LogMetrics, trace sampling and
visibility into cost at the team/environment level.
• Pathway from open source: For organizations already familiar with open-
source monitoring tools such as Prometheus, Fluent Bit and Telegraf, Logz.io
offers a path to observability with a fast time to value by incorporating its
existing portfolio into an enterprise-level platform.
• Geographic presence: Headquartered in EMEA, Logz.io’s customer base and
operations are geographically diversified. While the majority of customers are
in North America and EMEA, the Open 360 observability platform is hosted
across multiple global SaaS instances, supports 36 languages, and includes
regional data security and compliance controls.
Cautions

• Lacking front-end focus: Logz.io prioritizes creating insights based on

telemetry collected via OpenTelemetry and other open-source solutions.
Front-end visibility via, for example, real-user monitoring and session replay
is lacking.
• Technical focus: Insights provided by observability platforms continue to
extend beyond system health and performance. The Logz.io platform retains
a technical focus, and is missing capabilities sought by more business-
oriented stakeholders, such as business transaction monitoring and funnel
analysis.
• Market visibility: Although Logz.io is experiencing growth in customers, this is
largely limited to their target of SMEs. In contrast to other vendors in this
research, Logz.io is not mentioned as a competitor among its peers, and
rarely appears in vendor shortlists or inquiry calls with Gartner clients.
Microsoft

Microsoft is a Challenger in this Magic Quadrant. Azure Monitor is its observability

platform and the Microsoft-Azure-native monitoring solution. The company has
substantial geographic diversity, and its clients tend to be midsize-to-large
enterprises. Along with pervasive incorporation of generative AI, Microsoft’s
observability roadmap includes an inexpensive storage mechanism for bulk log data
and application modeling via service groups.
Strengths

• AI-enhanced: Microsoft’s alliance with OpenAI has resulted in generative AI

capabilities in the form of Copilot interfaces within Azure Monitor. ML support
is evident in the Kusto Query Language (KQL) within Azure Monitor, as well
as in features that enable customers to create ML pipelines for log data
stored in the platform.
• Prometheus support: As part of the new Azure Monitor Metrics subsystem,
Microsoft has released a managed service for Prometheus. It allows
customers to directly ingest metrics from supported services such as Azure
Kubernetes Service (AKS); remote write from self-managed Prometheus
instances and analyze using PromQL; visualize using Grafana; and alert using
native alert rules. A metrics explorer with PromQL is in preview at time of
publication.
• Integrated with security monitoring: Microsoft’s security monitoring products,
Sentinel and Defender, are built upon and well-integrated with Azure Monitor,
allowing the entire suite to support a unified analytics, reporting and incident
response capability across operations and security functions.
Cautions

• SLO management: Azure Monitor does not yet include a first-class SLO
creation and monitoring capability, and lags competitors in this respect. Such
a feature is scheduled for release in 2024. In its absence, SLO management
in Azure Monitor is cumbersome.
• Delayed OpenTelemetry (OTel) collector support: Azure Monitor can ingest
OpenTelemetry data via an exporter, but support for ingestion of
OpenTelemetry Protocol (OTLP) directly via a collector interface is not yet
available. An Azure Monitor edge pipeline, which includes collector support,
entered public preview in late April 2024.
 • Prometheus idiosyncrasies: Azure Monitor includes support for Prometheus
metrics collection and analysis. There are currently some incompatibilities
with open-source Prometheus and other Prometheus-compatible systems.
New Relic

New Relic is a Leader in this Magic Quadrant. The New Relic observability platform
is offered as SaaS, encompassing a broad range of capabilities, including APM, AI
monitoring, DEM, infrastructure monitoring, security, and log management. New
Relic customers are typically medium-to-large enterprises across verticals and
mainly in the Americas, EMEA and APAC. Building on its leading data platform, New
Relic has seen recent enhancements in optimizing log storage and cost, AI
monitoring, generative AI and application security. In November 2023, New Relic
was acquired by Francisco Partners and TPG.
Strengths

• Flexible licensing model: New Relic’s classic licensing model, based on

ingestion and number of users, offers an alternative for customers
discouraged by host-based licensing. Its new compute-based licensing
option provides further choice by aligning cost with consumption.
• AI monitoring: New Relic’s newly implemented AI monitoring allows
engineers to benefit from observability capabilities across the AI stack. In
addition to ML model performance monitoring, AI monitoring also compares
cost and performance across large language models (LLMs).
• Consolidated data platform: New Relic’s telemetry data platform (TDP) is a
storage and analytics engine optimized for telemetry management and built
on its New Relic database (NRDB) technology. It supports high cardinality
data and native support for OpenTelemetry.
Cautions

• Implementation and configuration complexity: Some clients have indicated

that initial setup and configuration is time-consuming, especially if you are
not familiar with the tool.
• Limited geographic footprint: New Relic service delivery platforms are
located in the U.S. and EMEA (Germany). The SaaS platforms are largely
 hosted in AWS, but also include an Azure-based option. Organizations
outside North America and EMEA, particularly those in APAC, may need to
confirm that the company’s offering meets any region-specific performance
or sovereignty requirements.
• Acquisition-related impacts: New Relic’s acquisition and shuffle in leadership
brings in regular questions regarding product roadmap, customer
relationship management and overall stability of the company. New Relic
claims to have increased its investment in platform innovation since going
private.
Oracle

Oracle is a Niche Player in this Magic Quadrant. Oracle Cloud Observability and
Management (O&M) Platform supports hybrid and multicloud application, log,
infrastructure, and database monitoring, with a focus on Oracle Cloud Infrastructure
(OCI) and enterprise applications. Oracle has a global reach with diversified
operations; its clients are cross-industry, midsize-to-large enterprises, including
government agencies. Oracle’s roadmap for O&M targets an enhanced experience
for SRE teams, further ITSM integration, and focus on log telemetry pipeline
management and analytics.
Strengths

• Global coverage: Oracle has a worldwide presence, with support for multiple
languages. This extends to compliance with regional regulatory and data
residency requirements through its EU Sovereign Cloud, FedRAMP approval,
and OCI Dedicated Region for deployment in customers’ own data centers.
• Holistic Oracle integration: Although primarily centered around OCI, Oracle
also prioritizes O&M support for its broader portfolio, including E-Business
Suite (EBS) and PeopleSoft running outside OCI. Enterprises reliant on these
applications will benefit from tailored dashboards, automated instrumentation
and end-user experience monitoring out of the box.
• Multicloud support: In contrast to other cloud service providers represented
in this research, Oracle has consistently maintained a vision for O&M that
 extends beyond its own ecosystem to include support for multicloud
workloads.
Cautions

• Market presence: Although Oracle targets O&M’s capabilities as a

multicloud-capable offering, it has achieved limited success in raising
awareness of the solution outside its existing customer base. In contrast to
other vendors in this research, knowledge of OCI’s native observability
platform is not widespread, and it rarely appears as a vendor in Gartner client
inquiries.
• Slow to implement generative AI: 2023 saw the majority of vendors in the
Magic Quadrant implementing generative-AI-based capabilities. While OCI
offers various avenues to support AI and ML, Oracle has been slow to
implement generative AI use cases for observability. At the time of writing,
generative AI for O&M is in development.
• Business-centric observability: SRE and DevOps teams are focused on
ensuring continuity of key business services. While Apdex scoring and
reporting are supported, O&M is missing the implementation of SLOs,
service-level indicators (SLIs) and error budget management needed to
support SRE best practices.
ServiceNow

ServiceNow is a Visionary in this Magic Quadrant. ServiceNow’s observability

platform includes Cloud Observability (formerly Lightstep), as well as capabilities
included in its IT operations management (ITOM) and ITSM modules. ServiceNow
has clients in all verticals. ServiceNow’s operations are geographically distributed,
and it segments its customers as Marquee (the largest 250), Enterprise, Commercial
and Nonprofit.
ServiceNow’s roadmap is focused on implementing generative AI capabilities
across its portfolio.
Strengths

• OpenTelemetry support: ServiceNow Cloud Observability was created from

the outset to support ingestion, analysis and delivery of health and
 performance insights based on OpenTelemetry. Advanced OTel capabilities
include collector management based on Open Agent Management Protocol
(OpAmp), as well as Apache Arrow compression.
• Market presence: ServiceNow has strong traction in the enterprise market,
particularly with larger companies. ServiceNow has integrations with a wide
range of common business applications and an established presence in
enterprise markets with its ITSM offering. This provides a large installed base
with which to position Cloud Observability as a product-led growth
opportunity.
• Comprehensive portfolio: Cloud Observability capabilities are increasingly
being aligned with those of the broader ServiceNow ITOM and ITSM
solutions. This makes Cloud Observability an attractive option for
ServiceNow customers that require an observability platform.
Cautions

• Market awareness: Gartner inquiries with ServiceNow clients indicate very

low awareness of the Cloud Observability solution, with many clients
evaluating other vendors in this report unaware of the presence of
ServiceNow’s offering in this area. Compared to dedicated Observability
vendors, ServiceNow does relatively little to promote Cloud Observability in
the market.
• Portfolio confusion: Cloud Observability sits alongside but separate from
other parts of the ServiceNow portfolio. Features such as SLO management,
which one might expect to be part of an observability platform, are included
in ServiceNow ITOM, which may require a much larger purchase. In May,
ServiceNow announced plans to further integrate ITOM and Cloud
Observability, as well as new components, such as Service Reliability
Management.
• Roadmap: In comparison with Leaders in this research, the ServiceNow
roadmap currently demonstrates limited ambition for its Cloud Observability
solution relative to other parts of its portfolio.
Splunk
Splunk is a Leader in this Magic Quadrant. The Splunk observability platform
comprises Splunk Platform, Splunk IT Service Intelligence and Splunk Observability
Cloud. Its operations are geographically diversified, and its customers tend to be
large enterprises. Cisco’s acquisition of Splunk was completed on 18 March
2024. The Cisco AppDynamics product team was subsequently merged with the
former Splunk product teams and AppDynamics was made part of its combined
observability portfolio. The materials used for this research were collected prior to
the closing date, and therefore references in this report are to Splunk rather than
Cisco.
Strengths

• OpenTelemetry support: Strong support for OpenTelemetry continues to be a

strength of Splunk’s observability platform. The Splunk OpenTelemetry
collector is supported commercially and includes distributions for Linux,
Windows and Kubernetes.
• SLO management: Splunk Observability includes a workflow to assist
customers in establishing and managing realistic SLOs via the UI, or on an
automated basis using Terraform. Support for alerting on SLO burn rate
analysis is included as well.
• Unified solution: Although the boundaries between components are evident,
by more tightly integrating them, Splunk’s observability platform supports IT
operations, engineering and cybersecurity use cases more seamlessly than
many competitors.
Cautions

• Acquisition uncertainty: Cisco recently closed its acquisition of Splunk and

rationalizing the product lines is a work in progress. The sales process is also
uncertain, given the different go-to-market strategies employed by the two
organizations.
• Dissimilar geographic footprint: Splunk Cloud is a superset of the Splunk
Observability Cloud regional footprint, with the former having four times the
footprint of the latter. Both have presence in North America, EMEA and
 APAC. Organizations with strict data sovereignty requirements may need to
examine these locations more closely.
• Pricing: Splunk Observability Cloud is licensed by entity (host) or by usage
(metric time series and traces analyzed per minute), while Splunk Enterprise
is licensed by volume of data ingested or by workload (Splunk Virtual
Compute). Pricing comprehension and predictability may be a challenge for
customers and prospects.
Sumo Logic

Sumo Logic is a Niche Player in this Magic Quadrant. Its Observability platform is
focused on providing availability, performance and security analysis. Its operations
are geographically diverse, and its clients include enterprise and midmarket
segments. Sumo Logic has recently released AI-driven alerting and optimization for
anomaly detection. Sumo Logic customers are typically small-to-midsize
enterprises and are mainly in the Americas and APAC.
Strengths

• Pricing model: Sumo Logic’s new pricing, Flex Licensing, is based on

analytics and not data ingestion. Customers are charged for analytics (data
scanning and queries); for example, dashboards, log analytics or monitors.
Ingest cost is $0.
• OpenTelemetry adoption: OpenTelemetry collection is used to collect
telemetry for all new and existing customers. Sumo Logic provides native
integrations and updated workflows for leveraging OpenTelemetry.
• Points of presence: The platform is available in nine AWS regions across the
globe, including North America, EMEA and APAC, to support data residency
and data sovereignty requirements.
Cautions

• Log centricity: Although Sumo Logic has tracing and metrics capabilities, it is
positioned primarily as a log analytics tool. Organizations seeking a tool to
provide deep insights into application behavior may be better served by other
products in this research.
 • Market momentum: While Sumo Logic has seen an increase in overall
revenue, growth in observability platform revenue has been flat since 2022.
This contrasts with a 10% growth in the market at large.
• Lack of native synthetic monitoring: Sumo Logic does not offer native
synthetic monitoring capabilities. Customers requiring such features must
enlist an additional tool to do so. The platform does, however, support out-
of-the-box integration to Catchpoint, including prebuilt dashboards.

Vendors Added and Dropped

We review and adjust our inclusion criteria for Magic Quadrants as markets change.
As a result of these adjustments, the mix of vendors in any Magic Quadrant may
change over time. A vendor's appearance in a Magic Quadrant one year and not the
next does not necessarily indicate that we have changed our opinion of that vendor.
It may be a reflection of a change in the market and, therefore, changed evaluation
criteria, or of a change of focus by that vendor.

Added
The following vendors met the inclusion criteria and have been added to the Magic
Quadrant:

• BMC
• Chronosphere
• LogicMonitor

Dropped

• Broadcom was dropped because it did not meet the CII threshold for this
market.
• Cisco was dropped because the Cisco Observability Platform product
submitted for evaluation in this research was discontinued.
• ManageEngine was dropped because it did not meet the CII threshold for
this market.
 • Riverbed was dropped because it did not meet the CII threshold for this
market.
• SolarWinds was dropped because it did not meet the inclusion criteria for
this research.

Inclusion and Exclusion Criteria

For Gartner clients, Magic Quadrant research identifies and then analyzes the most
relevant providers and their products in a market. Gartner uses, by default, an upper
limit of 20 providers to support the identification of the most relevant providers in a
market. The inclusion criteria represent the specific attributes that analysts believe
are necessary for inclusion in this research. To qualify for inclusion, providers must
meet the following:

Market Participation Inclusion Criteria

• Provide generally available capabilities as of 14 March 2024. General
availability means the product or service is widely available to all customers
for purchase through normal sales channels.

• Sell the observability platform solution directly to paying customers without

requiring them to engage professional services help. The vendor must
provide at least first-line support for these capabilities, including any bundled
open-source software. This includes, but is not limited to, comprehensive
product documentation, installation guidance and reference examples.
• Demonstrate an active product roadmap, as well as go-to-market and selling
strategies for their solutions.
• Have phone, email and/or web customer support. They must offer contract,
console/portal, technical documentation and customer support in English
(either as the product’s default language or as an optional localization).

Capabilities Inclusion Criteria

 • Observability platform offerings must offer native support for all mandatory
capabilities and a majority of the common capabilities described in Gartner’s
Market Definition.
• Observability platform offerings must be delivered via SaaS. Vendors may
also provide self-hosted alternatives for clients that require them, but the
self-hosted options are outside the scope of this research.

Performance Threshold Achievement

• The observability platform offering must have at least 50 paying, production
(non-beta-test) customers in at least each of two or more geographic regions
(Asia/Pacific, EMEA, Latin America or North America), excluding sales to
MSPs.

• The observability platform offering must have generated at least $75 million
in annual generally accepted accounting principles (GAAP) revenue during
the 12 calendar months prior to its receipt of Gartner’s Magic Quadrant
welcome packet.
Or:

• The observability platform offering must have generated a minimum of $10

million in annual revenue, combined with a growth rate of at least 25% in the
12 calendar months prior to the receipt of this letter, compared to its
previously completed 12-month period.
In addition, the vendor must rank among the top organizations using the Customer
Interest Indicator (CII) defined by Gartner for this Magic Quadrant. CII was
calculated using a weighted mix of internal and external inputs that reflect Gartner
client interest, vendor-customer engagement and vendor-customer sentiment.

Honorable Mentions
Gartner is tracking more than 40 vendors in the observability platforms market. This
research focuses on 17 vendors that met our inclusion criteria. However, the
exclusion of a particular vendor does not necessarily mean that it should not be
considered, or that it does not have viability and capabilities that may be a fit for a
customer’s unique requirements.
Observe: One of the first observability vendors to build its platform on the
Snowflake cloud data platform, Observe caught our eye in 2021, when it was
identified as a Gartner Cool Vendor. The company continued to quietly build
capabilities and a customer base until its Series B in March 2024, when it began to
build momentum. Observe is positioned to disrupt this increasingly fragmented and
costly market with its innovative and capable, data-driven analytics platform. This
year, Observe did not meet the nonfunctional criteria for inclusion in this research.

Evaluation Criteria
Ability to Execute
Gartner analysts evaluate vendors on the quality and efficacy of the processes,
systems, methods or procedures that enable provider performance to be
competitive, efficient and effective, and to positively impact revenue, retention and
reputation. Ultimately, vendors are judged on their ability and success in capitalizing
on their vision.
Product: This looks at the core observability technologies that compete in the
observability platform market. This includes current product capabilities, quality and
feature sets. Additional consideration is given to the vendor’s scalability, availability
and integration, as well as its security features.
Overall viability: This criterion includes an assessment of the organization’s overall
financial health, as well as the financial and practical success of the business unit.
Considerations include profitability, geographic distribution of revenue and R&D
spending.
Sales execution/pricing: This covers the assessment of a vendor’s success in the
market. Vendors’ pricing models and proposals are compared for value and
complexity, as well as pricing transparency. Considerations include pricing and
discounting, new versus repeat business, and competitive dynamics, including
awareness of competitors.
Market responsiveness: This criterion looks at a vendor’s ability to respond and
change direction, based on the evolution of customer needs and changes in market
dynamics. Considerations include response to competitors and ability to listen and
respond to customer feedback.
Marketing execution: This looks at the clarity, quality, creativity and efficacy of
programs designed to deliver the vendor’s message in order to influence the
market, promote the brand, increase awareness of products and establish a positive
identification in the minds of customers.
Customer experience: This covers the products and services and/or programs that
enable customers to achieve anticipated results with the products evaluated. This
may also include ancillary services, customer support programs and availability of
user groups. Considerations include postsales support, programs for high-touch or
VIP customers, and specific delivery partners in-region.
Operations: This criterion looks at the ability of the vendor to meet goals and
commitments. Factors include quality of the organizational structure, skills and
relationships, and their ability to meet service-level agreements. Considerations
include partnerships with cloud providers, outages that affect customers, and SLA-
adherence.
The Ability to Execute criteria used in this Magic Quadrant are listed in Table 1.
Table 1: Ability to Execute Evaluation Criteria
Enlarge Table

Evaluation Criteria Weighting

Product or Service High

Overall Viability Medium

Sales Execution/Pricing Medium

 Evaluation Criteria Weighting

Market Responsiveness/Record High

Marketing Execution Medium

Customer Experience High

Operations Low

Source: Gartner (August 2024)

Completeness of Vision
Gartner analysts evaluate vendors on their ability to understand current market
opportunities and create and articulate their vision for future market direction,
innovation, customer requirements and competitive forces. Ultimately, vendors are
rated on their vision for the future, and how well that maps to Gartner’s position.
Market understanding: This criterion considers a vendor’s ability to understand
customer needs and translate them into products. Vendors that show a clear vision
of their market listen, understand customer demands, and can shape or enhance
market changes with their added vision. Consideration is given to understanding the
rapidly evolving observability landscape and how it is distinguished from APM.
Marketing strategy: This criterion looks for clear, differentiated messaging
consistently communicated internally and externalized through social media,
advertising, customer programs and positioning statements. Consideration is given
to new market outreach, innovative marketing initiatives and true differentiation.
Sales strategy: This criterion considers whether the vendor has a sound strategy for
selling that uses the appropriate networks, including direct and indirect sales,
marketing, service, communication and partners that extend the scope and depth of
market reach, expertise, technologies, and the vendor’s customer base.
Consideration is given to channel strategy and understanding the buyers and
influencers involved in selection of observability platform products.
Offering (product) strategy: This criterion evaluates whether a vendor’s approach to
product development and delivery emphasizes market differentiation, functionality,
methodology and features that cover current and future requirements.
Consideration is given to quality and cadence of vendors’ product roadmap and
investment priorities into adjacent market segments within the ITOM landscape.
Business model: This criterion looks at the design, logic and execution of the
vendor’s business proposition to achieve continued success. Consideration is given
to vendors’ business, value proposition, ability to anticipate shifts in
licensing/pricing models and relationship with open-source communities.
Vertical/industry strategy: As observability platforms tend not to be industry-
specific, evaluating these in detail is not a key element of this research. Where
vertical or industry differentiation is relevant, questions are included in other criteria
categories.
Innovation: This criterion looks at direct, related, complementary and synergistic
layouts of resources, and expertise or capital for investment, consolidation,
defensive or preemptive purposes. Consideration is given to the level of investment
in product development in new areas related or adjacent to observability, third-party
and partner relationships and integrations, and use of AI/ML and other novel
capabilities.
Geographic strategy: This criterion looks at the provider’s strategy to direct
resources, skills and offerings to meet the specific needs of geographies outside its
“home” or native geography, either directly or through partners, channels and
subsidiaries, as appropriate for that geography and market. Additional consideration
is given to the number of employees allocated to different regions, locations of
SaaS delivery platforms, tailoring of go-to-market or product strategy to address
regional differences, and the depth and scope of partners available in countries with
existing and new customers.
The Completeness of Vision criteria used in this Magic Quadrant are listed in Table
2.
Table 2: Completeness of Vision Evaluation Criteria
Enlarge Table

Evaluation Criteria Weighting

Market Understanding High

Marketing Strategy Medium

Sales Strategy Medium

Offering (Product) Strategy High

Business Model High

Vertical/Industry Strategy NotRated

Innovation High

Geographic Strategy Medium

Source: Gartner (August 2024)

Quadrant Descriptions
Leaders
The observability platforms Leaders quadrant comprises vendors that provide
products that are a strong functional match to general market requirements and
those that have been among the most successful in building and expanding their
customer base. They have comprehensive portfolios that offer superior analytics
and visibility and have broad integration with other ITOM technologies. Leaders
demonstrate evidence of superior vision and execution for emerging and
anticipated market requirements, as well as a consistent track record of innovation
and customer experience.

Challengers
The observability platforms Challengers quadrant comprises vendors with broad
market reach and large deployments. Vendors in this quadrant typically have strong
execution capabilities and a significant sales and brand presence garnered from the
company as a whole, if not directly from its observability-related activities. Some
vendors previously may have been among the top performers in the market and,
thus, offer broad product portfolios. Vendors in this quadrant may be transforming
their product offerings and market focus. In some cases, their offerings are often
positioned as elements of a larger solution that may even extend beyond the
boundaries of ITOM.

Visionaries
The observability platforms Visionaries quadrant comprises vendors that provide
products and have built a compelling plan to competitively address observability
platform market requirements, but with a product portfolio that may still be a work
in progress. They have a lower ability to execute than the Leaders. This is typically
due to a lower ability to respond to market conditions, bring together the necessary
product and platform requirements, and effectively gain and expand on market
share.

Niche Players
The observability platforms Niche Players quadrant comprises primarily, but not
exclusively, vendors with solutions catering to specific audiences or with limited
use-case support. Because they do not demonstrate equal depth across all core
capabilities (see the Market Definition section), they typically do not meet the
observability needs of the broader market. Or they may do so within specific
verticals or market segments or geographic regions only. In addition, vendors in this
quadrant may have a more limited ability to invest in the necessary functional and
sales and marketing capabilities to expand beyond their current focus. Inclusion in
this quadrant does not reflect negatively on the vendors’ value in the markets in
which they choose to compete.

Context
Observability Platforms: What’s Next?
The market that this research analyzes has been in near-constant upheaval over the
last few years. It is fiercely competitive, comprises vendors that are utterly diverse in
company size, operating model, origin and longevity, and includes a substantial
open-source component as well. Truly, there should be something for everyone.
Product quality and capabilities continue to advance, but so does cost. Gartner is
starting to see significant discontent with the budgetary requirements necessary to
obtain the benefits of observability, resulting in a steady stream of questions from
clients along the lines of “Is it worth it?”
At the same time, IT operations is not immune from the artificial intelligence furor
that is becoming ubiquitous, and this was quite evident during this Magic Quadrant
project. What should the role of AI in IT operations be?
It is hard to think about this without mentioning “AIOps,” a term that Gartner is
sometimes credited with coining, but that has long since taken on a life of its own.
What is the role of AI in observability and what does that have to do with AIOps?
This has become another very common client inquiry question. If we count the
number of times “AI” and “AIOps” appeared in the materials used in this Magic
Quadrant research, the answer is quite a lot, indeed.
Additional research that elaborates on our vision for AI in IT operations is
forthcoming.
As for observability platforms specifically, these are fundamentally data
management and analytics tools, and virtually any such tool nowadays is expected
to make use of AI techniques as part of its baseline or table stakes capabilities.
Adaptive thresholds, anomaly detection and advanced correlation are all examples
of capabilities without which it would be very difficult to meet the minimum
requirements to appear in this research. Use of AI within observability platforms will
continue to evolve. As with any such product, Gartner encourages evaluations to be
based on how a product aligns with your use cases, rather than the presence or
absence of a specific enabling technology such as AI.
The variety of vendors providing observability products today makes it likely that
there is at least one product that best meets an organization’s specific
requirements. Moreover, because space and time is limited relative to Magic
Quadrants, there are many, capable vendors in the market that are not included in
this research. As questions arise, please let us know.

Market Overview
The evolution of this market from APM, to APM and observability, to this year’s
observability platforms reflects broader initiatives. These include the widespread
digitization of business, cloud adoption and the pervasive (some might say
benevolently toxic) role that technology plays in our lives. In short, the number of
workloads increases, the telemetry generated by these workloads increases in
volume and complexity, and this puts pressure on the capabilities required to
understand health, performance and user experience.
In addition, Gartner has witnessed growth in the adoption of these tools in the
following areas:

• Expansion within existing clients: In the past, a fairly small portion of

applications, usually those that are client-facing or revenue-generating, were
monitored via an APM solution. As APM and observability
platform products evolved in capability, simplified deployment, accelerated
time to value and decreased in price, we witnessed increased utilization of
the tools to cover a larger percentage of applications. As macroeconomic
conditions oscillate and organizations struggle with the variable costs of
consumption-based and pay-as-you-go platforms and tools, rationalization
has begun to favor “full-stack” products, or those that can ingest and analyze
telemetry more holistically.
 • Expansion into previously untapped industries: APM and observability tools
most often were found inside large enterprises, in industries such as banking,
finance and global retail. These industries had a high level of maturity in IT
systems and could recognize the benefits of deploying monitoring tools.
Observability platforms often have open-source roots, or include open-
source interfaces. This offers an additional onramp, so to speak, as smaller
and midsize enterprises may find themselves in over their heads when the
management of open-source observability tools exceeds the time and
expertise available for doing so. The smooth transition into modern
observability platforms is welcome.
• Competitive CSP-native solutions: As the percentage of IT budgets spent on
observability increases, public cloud service providers have taken notice, and
have added features and capabilities that in many cases rivals those of
incumbent commercial products. Particularly in organizations that are
comfortable moving between multiple observability platforms, or with
workloads that are less interdependent, the CSP-native observability tools
remain quite compelling.
The consolidation of monitoring domains and practices continues. This is a natural
response to the ongoing shift of operational responsibility toward focusing on an
application’s ability to deliver its intended outcomes and away from optimizing
specific supporting technology. This shift is further reflected in the continued
concentration of monitoring tooling spend growth in those market segments most
aligned with this shift, and with growing market demand for observability products
and adjacent segments, namely DEM and infrastructure monitoring. Given the
above trends, Gartner expects the market for observability products to reach an
estimated $11.1 billion by 2027, with an 8.3% compound annual growth rate
(CAGR) between 2021 and 2027 in constant currency (see Forecast: IT Operations
Management Software, Worldwide, 2021-2027).
The observability platforms market will continue to evolve during the next several
years, driven by the following key trends:
• The need to view and analyze telemetry from multiple sources in context,
without having to switch tools.
• This increase in the amount and types of data continues to drive health and
performance monitoring tools to more closely resemble analytics tools.
Coupled with the advances in AI, there is tremendous potential for
advancements in more autonomous or “self-driving” features here, up to and
including those that have more of an optimization posture than problem
resolution.
• Support for cybersecurity use cases is increasingly being added to products
in this market. To date, most of these capabilities have been additive — that
is, they do not purport to replace existing cybersecurity tools. As these
capabilities mature and the observability platform vendors build credibility
among security practitioners, they may become competitive in those markets
as well.
• As organizations deploy their own AI- and LLM-based workloads,
understanding how to monitor them will increase in priority. They are a
relatively small part of the market today, but we are already seeing some
observability products claim to support this type of workload.
• Demand for greater support of use cases beyond the typical IT
operations context, inclusive of external (market-facing) and internal
application product owners, product teams, platform engineering/SRE/cloud
operations teams, and others taking a DevOps approach. These users and
buyers require, at a minimum, a holistic view and understanding of
application performance across the entire stack and across multiple IT
teams.
• Increasing adoption of central observability teams, an organizational device
that centralizes SLO creation and reporting, telemetry life cycle management,
tool selection, and incident response management.
• SaaS products and cloud services present new challenges to I&O teams,
particularly as more and more business-critical services depend on them.
However, monitoring these workloads requires new approaches.
 Observability platform vendors are investing in capabilities to extend their
scope to cover them.
• Mergers and acquisitions, as well as product refresh and consolidation, will
continue to reshape the vendor landscape. At least two of this year’s
participants were acquired by private equity organizations in 2023, and the
chips are still falling in Cisco’s acquisition of Splunk.