|By Sandi Mappic||
|June 19, 2014 12:00 PM EDT||
Most technology folks have heard Marc Andreessen’s provocative statement, “Software is eating the world.” Whether you agree fully or not, you’re realizing that your business critical software applications increasingly drive both the top-line revenue growth and the bottom-line operational efficiency of your company – and often form the pillar of your business identity.
Legacy monitoring systems you have in place, capturing and alerting on scores of infrastructure level metrics, have helped protect your technology investment to some degree. I’ve worked for two leaders in that space, HP and BMC, so can personally attest to the real benefits of server, network and database monitoring that clients achieve. However, as consumer demand for superior services and faster innovation accelerate, we see that the applications and associated business transactions are what end-users ultimately care about. You can no longer afford slow response time, let alone application outage situations, as customers will delay or abandon purchases – or worse yet switch to a competitor when you have unacceptable application performance. And unfortunately these “Yellow Light” or slow performance situations are the most challenging to detect and fix!
So you’ve come to the conclusion that you need a full-fledged application performance management (APM) solution. The question some companies wrestle with at this point is: “Should we invest in an 3rd party APM solution or build it ourselves?”
Four key considerations should be:
Upfront Costs – such as Initial Project Build & Software License cost.
Ongoing, Annual Solution Costs – such as Server / Storage footprint, administrative maintenance & support, & agile development / release activities.
Solution Capabilities Driving Benefits – chiefly, the ability to drive down the number of performance defects in production, as well as the MTTR when issues do occur.
Opportunity Costs – personnel resources working on in-house APM, versus are there mature 3rd party APM solutions available for purchase.
1. Upfront Costs
It’s difficult to estimate exactly how long it would take a company to develop a basic application monitoring tool in-house – but we’ll give it a logical shot. Of course, on the plus side, the company would avoid spending money on a “commercial off-the-shelf” (COTS) 3rd party software application. Based on experience for design, development, testing, and release, a good estimate for an in-house Initial Project Build is a team of 2-3 Engineers about 6 months to have a basic, log parsing and alerting tool ready. A more robust tool for a medium to large sized deployment may be 2-3x this size and investment. A gaming company we work with, when assessing an in-house build situation, estimated an APM product development lifecycle in the 12 to 18 month range. Why? APM functionality that involves tracing the user experience of distributed transactions, where every call needs to be traced across each service layer, is non-trivial technical work. Also, you’ll need to factor in one-time hardware and prerequisite software purchasing costs. So a ballpark cost from $400K to well into seven figures is reasonable.
What would be the upfront software licensing cost of a 3rd party APM solution? Probably in a similar range, perhaps higher in certain cases. Also, many APM companies offer lower annual SaaS subscription costs as an alternative to full upfront licensing payments – which add up to the same licensing fees over 3-5 years. However, you should take into consideration that some solutions such as AppDynamics, which can be downloaded and installed via self-service within hours, provide immediate Time-to-Value versus waiting for a full software development lifecycle to occur for a custom built solution.
Advantage: Cost = In-house (slight? depends on robustness of APM solution built), Time-to-Value = 3rd Party APM
2. Ongoing, Annual Solution Costs
First, let’s determine the hardware & storage footprint required for the solution. Typical in-house developed solutions architect for over-capacity as a rough estimate because of unknowns, and to avoid encountering limitations & performance issues. A good estimate per environment (Dev, Test, Prod) may be 2 Large Servers and 16 TB of Storage for a starter in-house APM solution. This cost might run in the $100K to $135K range per year.
For 3rd party APM solutions, the specs are well-known, validated, and published. A leading APM solution like AppDynamics has been built and tuned via R&D by specialists over several years. The footprint for a similar medium-sized deployment would be 1 Medium Server and 6 TB of Storage, for a rough cost of about $40-50K per year – or less than half of the in-house cost.
From an FTE support perspective for the in-house solution, you have to understand the administrative, support, & enhancement / new development labor required. A good admin & support estimate would run about 1-2 FTEs, and new development might run 2 engineering FTEs to keep up with enhancement requests and coverage for new applications & technologies. Remember, users will not expect the APM solution to stay static! You might start with basic metric stores and time series data, but this will quickly run out of steam. Next, you’ll want to build a baseline engine for the metric store based on load patterns and percentiles of metrics, as examples. Demand for dashboarding and security access control requirements come into play, and require much design and testing work especially as the solution scales. So this annual labor cost would run in the $375K plus range.
On top of that, in today’s Agile DevOps world, there are additional maintenance / revision labor costs each time a business application is released to production. Appliances and/or monitoring agents need updating, and both application and business transaction topology maps likely need to be revised manually. As the frequency of application release grows, often to a bi-weekly application release schedule, these are not insignificant tasks. We estimate in a medium sized deployment, this could require about 2,000 labor hours per year to keep up, or about $100K.
In the AppDynamics APM world, these types of capabilities are already built into the solution. So the maintenance per application release is zero since there is automated application discovery, mapping, and business transaction flows out of the box. The ongoing FTE administrative & maintenance requirements for a medium-sized deployment are 1 FTE, or about $125K/year. And new development is covered in the license costs via the hundreds of R&D professionals contributing to the various releases of the 3rd party software.
Advantage: 3rd Party APM (large, especially adding up multiple years)
3. Solution Capabilities Driving Benefits
Next we look at the ability of an APM solution to provide benefits to your enterprise – which can be grouped into reducing costs, mitigating risks, and increasing or protecting revenue. Two key performance metrics we suggest for measuring impact on cost, risk, and revenue are:
# defects released to production
Mean time to repair (MTTR) per performance issue
At AppDynamics, this is where we’ve invested our R&D dollars since 2008, and our industry-exceeding Net Promoter Score (NPS) of 84 – i.e., more than 8 in 10 customers would recommend us to a friend or colleague – is a testimony to our ability to achieve these benefits.
By leveraging AppDynamics in Pre-Production, our clients often report reduction in performance issues released to Production of 40%. And by watching every line of code executed in Production, and measuring & scoring each transaction, we provide a “3 clicks to resolution” approach that often reduces MTTR per performance issue by 65% or more. This is true of small application environments, as well as large deployments over 20,000 JVMs.
For an in-house solution, you have to assess what it would take to build similar APM capabilities to achieve these levels of defect and MTTR reduction. How many years, developers, and dollars? (And, as one client executive recently told us, “If I could do this, why wouldn’t my company be competing in the APM software space?!”) Or alternatively and more likely, “let’s stitch something low-cost together” in-house. Admittedly this sacrifices capability for cost cost, which translates into fewer features to address the MTTR and # of performance issue challenges you face.
For ballpark purposes, then, let’s credit the in-house solution in helping reduce both # of defects and MTTR up to 20%. If we use an industry average cost per minute of slowness / downtime equating to $500 (inclusive of both labor and revenue protection factors), and there is one Sev1 performance issue per application per quarter – the difference between the in-house solution versus an APM solution would equate to over $1M per year for a medium sized deployment.
Advantage: 3rd Party APM (not close; and these add up year over year, too)
4. Opportunity Costs
These costs deal chiefly with choosing what is most valuable for your developers to spend their time on. Especially in today’s high-technology enterprises, there are excellent engineers capable of building fantastic tools across a wide range of areas – so it is tempting to initiate an in-house APM build project and get something out the door. However, APM is not these engineers’ specialty and their talents are often better utilized on alternative software projects related to the core goods & services your company sells to your end-use customers that drive revenue.
This is an area we won’t attempt to quantify, as it’s more of a qualitative assessment and business decision specific to your organization. But with a fairly mature and continually developing 3rd Party APM market, for most enterprises it’s logical to say….
Advantage: 3rd Party APM
While the initial, upfront set of costs for an in-house vs. 3rd party APM solution purchase may be about the same (license vs build) – which leads some organizations to consider a “Do It Yourself” approach – there are significant ongoing annual costs for the care and feeding of an in-house APM solution compared to the 3rd party APM alternative. These include the infrastructure footprint, as well as labor costs associated with administration, maintenance & enhancements.
The biggest differential in cost is typically related to the chief purpose of an APM solution – how often does it proactively reduce the number of production defects, and how fast does it help you resolve performance issues when they do inevitably occur?
For a medium sized deployment, the total cost / benefit advantages of a 3rd party APM solution easily exceed $1M per year when compared to the in-house build alternative. This benefit accumulates year over year. And it’s worth mentioning here at AppDynamics, we achieve magnitudes of benefit even beyond other 3rd party APM solutions with lesser capabilities. We’ve leveraged the feedback of our over 1,000 customers during the past several years to drive R&D and greater benefit realization.
For AppDynamics, these advantages stem from:
The way our solution is architected to require minimal setup, upkeep and Time-to-Value, while providing ongoing Ease of Use.
Key capabilities – such as transaction tracing across complex, distributed applications, in your data center and the cloud – which lead to significant improvement in KPIs such as # performance defects and MTTR.
Our ability to intelligently scale to support the most complex and largest Pre-Production and Production environments.
Thought-leadership expanding into our “Application Intelligence” platform with a host of new modules and capabilities.
So when assessing an in-house vs 3rd party APM solution, consider a multi-year TCO horizon and not just a short-term initial cost estimate. Our personnel at AppDynamics standby to provide you help in not only getting a deep-dive on the APM market and our solution features, but also to analyze the value of APM choices via a detailed ROI assessment.
Thinking of trying a next generation APM solution rather than build it yourself? Try AppDynamics for free today!
The post Thinking About APM? 4 Key Considerations for Buy vs. Build Your Own written by Mike Murphy appeared first on Application Performance Monitoring Blog from AppDynamics.
The 3rd International Internet of @ThingsExpo, co-located with the 16th International Cloud Expo - to be held June 9-11, 2015, at the Javits Center in New York City, NY - announces that its Call for Papers is now open. The Internet of Things (IoT) is the biggest idea since the creation of the Worldwide Web more than 20 years ago.
Nov. 28, 2014 11:00 AM EST Reads: 1,797
Cultural, regulatory, environmental, political and economic (CREPE) conditions over the past decade are creating cross-industry solution spaces that require processes and technologies from both the Internet of Things (IoT), and Data Management and Analytics (DMA). These solution spaces are evolving into Sensor Analytics Ecosystems (SAE) that represent significant new opportunities for organizations of all types. Public Utilities throughout the world, providing electricity, natural gas and water, are pursuing SmartGrid initiatives that represent one of the more mature examples of SAE. We have s...
Nov. 27, 2014 04:00 PM EST Reads: 1,978
The security devil is always in the details of the attack: the ones you've endured, the ones you prepare yourself to fend off, and the ones that, you fear, will catch you completely unaware and defenseless. The Internet of Things (IoT) is nothing if not an endless proliferation of details. It's the vision of a world in which continuous Internet connectivity and addressability is embedded into a growing range of human artifacts, into the natural world, and even into our smartphones, appliances, and physical persons. In the IoT vision, every new "thing" - sensor, actuator, data source, data con...
Nov. 27, 2014 04:00 PM EST Reads: 2,066
How do APIs and IoT relate? The answer is not as simple as merely adding an API on top of a dumb device, but rather about understanding the architectural patterns for implementing an IoT fabric. There are typically two or three trends: Exposing the device to a management framework Exposing that management framework to a business centric logic Exposing that business layer and data to end users. This last trend is the IoT stack, which involves a new shift in the separation of what stuff happens, where data lives and where the interface lies. For instance, it's a mix of architectural styles ...
Nov. 27, 2014 03:00 PM EST Reads: 2,084
The Internet of Things is tied together with a thin strand that is known as time. Coincidentally, at the core of nearly all data analytics is a timestamp. When working with time series data there are a few core principles that everyone should consider, especially across datasets where time is the common boundary. In his session at Internet of @ThingsExpo, Jim Scott, Director of Enterprise Strategy & Architecture at MapR Technologies, discussed single-value, geo-spatial, and log time series data. By focusing on enterprise applications and the data center, he will use OpenTSDB as an example t...
Nov. 27, 2014 03:00 PM EST Reads: 2,230
An entirely new security model is needed for the Internet of Things, or is it? Can we save some old and tested controls for this new and different environment? In his session at @ThingsExpo, New York's at the Javits Center, Davi Ottenheimer, EMC Senior Director of Trust, reviewed hands-on lessons with IoT devices and reveal a new risk balance you might not expect. Davi Ottenheimer, EMC Senior Director of Trust, has more than nineteen years' experience managing global security operations and assessments, including a decade of leading incident response and digital forensics. He is co-author of t...
Nov. 27, 2014 01:00 PM EST Reads: 2,125
The Internet of Things will greatly expand the opportunities for data collection and new business models driven off of that data. In her session at @ThingsExpo, Esmeralda Swartz, CMO of MetraTech, discussed how for this to be effective you not only need to have infrastructure and operational models capable of utilizing this new phenomenon, but increasingly service providers will need to convince a skeptical public to participate. Get ready to show them the money!
Nov. 27, 2014 11:00 AM EST Reads: 1,951
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges. In his session at @ThingsExpo, Jeff Kaplan, Managing Director of THINKstrategies, will examine why IT must finally fulfill its role in support of its SBUs or face a new round of...
Nov. 27, 2014 10:00 AM EST Reads: 1,947
One of the biggest challenges when developing connected devices is identifying user value and delivering it through successful user experiences. In his session at Internet of @ThingsExpo, Mike Kuniavsky, Principal Scientist, Innovation Services at PARC, described an IoT-specific approach to user experience design that combines approaches from interaction design, industrial design and service design to create experiences that go beyond simple connected gadgets to create lasting, multi-device experiences grounded in people's real needs and desires.
Nov. 27, 2014 08:00 AM EST Reads: 1,924
Enthusiasm for the Internet of Things has reached an all-time high. In 2013 alone, venture capitalists spent more than $1 billion dollars investing in the IoT space. With "smart" appliances and devices, IoT covers wearable smart devices, cloud services to hardware companies. Nest, a Google company, detects temperatures inside homes and automatically adjusts it by tracking its user's habit. These technologies are quickly developing and with it come challenges such as bridging infrastructure gaps, abiding by privacy concerns and making the concept a reality. These challenges can't be addressed w...
Nov. 27, 2014 07:45 AM EST Reads: 2,052
The Domain Name Service (DNS) is one of the most important components in networking infrastructure, enabling users and services to access applications by translating URLs (names) into IP addresses (numbers). Because every icon and URL and all embedded content on a website requires a DNS lookup loading complex sites necessitates hundreds of DNS queries. In addition, as more internet-enabled ‘Things' get connected, people will rely on DNS to name and find their fridges, toasters and toilets. According to a recent IDG Research Services Survey this rate of traffic will only grow. What's driving t...
Nov. 27, 2014 07:00 AM EST Reads: 2,108
Connected devices and the Internet of Things are getting significant momentum in 2014. In his session at Internet of @ThingsExpo, Jim Hunter, Chief Scientist & Technology Evangelist at Greenwave Systems, examined three key elements that together will drive mass adoption of the IoT before the end of 2015. The first element is the recent advent of robust open source protocols (like AllJoyn and WebRTC) that facilitate M2M communication. The second is broad availability of flexible, cost-effective storage designed to handle the massive surge in back-end data in a world where timely analytics is e...
Nov. 27, 2014 06:45 AM EST Reads: 2,091
Scott Jenson leads a project called The Physical Web within the Chrome team at Google. Project members are working to take the scalability and openness of the web and use it to talk to the exponentially exploding range of smart devices. Nearly every company today working on the IoT comes up with the same basic solution: use my server and you'll be fine. But if we really believe there will be trillions of these devices, that just can't scale. We need a system that is open a scalable and by using the URL as a basic building block, we open this up and get the same resilience that the web enjoys.
Nov. 27, 2014 06:45 AM EST Reads: 2,168
"Matrix is an ambitious open standard and implementation that's set up to break down the fragmentation problems that exist in IP messaging and VoIP communication," explained John Woolf, Technical Evangelist at Matrix, in this SYS-CON.tv interview at @ThingsExpo, held Nov 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA.
Nov. 27, 2014 04:00 AM EST Reads: 1,824
We are reaching the end of the beginning with WebRTC, and real systems using this technology have begun to appear. One challenge that faces every WebRTC deployment (in some form or another) is identity management. For example, if you have an existing service – possibly built on a variety of different PaaS/SaaS offerings – and you want to add real-time communications you are faced with a challenge relating to user management, authentication, authorization, and validation. Service providers will want to use their existing identities, but these will have credentials already that are (hopefully) i...
Nov. 27, 2014 04:00 AM EST Reads: 1,761
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at @ThingsExpo, Robin Raymond, Chief Architect at Hookflash, will walk through the shifting landscape of traditional telephone and voice services ...
Nov. 26, 2014 02:00 PM EST Reads: 2,094
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at Internet of @ThingsExpo, James Kirkland, Chief Architect for the Internet of Things and Intelligent Systems at Red Hat, described how to revolutioniz...
Nov. 24, 2014 07:00 PM EST Reads: 2,254
Bit6 today issued a challenge to the technology community implementing Web Real Time Communication (WebRTC). To leap beyond WebRTC’s significant limitations and fully leverage its underlying value to accelerate innovation, application developers need to consider the entire communications ecosystem.
Nov. 24, 2014 12:00 PM EST Reads: 2,019
The definition of IoT is not new, in fact it’s been around for over a decade. What has changed is the public's awareness that the technology we use on a daily basis has caught up on the vision of an always on, always connected world. If you look into the details of what comprises the IoT, you’ll see that it includes everything from cloud computing, Big Data analytics, “Things,” Web communication, applications, network, storage, etc. It is essentially including everything connected online from hardware to software, or as we like to say, it’s an Internet of many different things. The difference ...
Nov. 24, 2014 11:00 AM EST Reads: 2,371
Cloud Expo 2014 TV commercials will feature @ThingsExpo, which was launched in June, 2014 at New York City's Javits Center as the largest 'Internet of Things' event in the world.
Nov. 24, 2014 09:00 AM EST Reads: 2,242