Click here to close now.

Welcome!

.NET Authors: Andreas Grabner, Pat Romanski, Elizabeth White, Tad Anderson, Greg O'Connor

Blog Feed Post

Thinking About APM? 4 Key Considerations for Buy vs. Build Your Own

image_pdfimage_print

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:

  1. Upfront Costs – such as Initial Project Build & Software License cost.

  2. Ongoing, Annual Solution Costs – such as Server / Storage footprint, administrative maintenance & support, & agile development / release activities.

  3. 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.

  4. 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:

  1. # defects released to production

  2. 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

4.  Summary

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?

Screen Shot 2014-06-19 at 8.47.02 AM

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:

  1. The way our solution is architected to require minimal setup, upkeep and Time-to-Value, while providing ongoing Ease of Use.

  2. 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.

  3. Our ability to intelligently scale to support the most complex and largest Pre-Production and Production environments.

  4. 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 appeared first on Application Performance Monitoring Blog from AppDynamics.

Read the original blog entry...

More Stories By AppDynamics Blog

In high-production environments where release cycles are measured in hours or minutes — not days or weeks — there's little room for mistakes and no room for confusion. Everyone has to understand what's happening, in real time, and have the means to do whatever is necessary to keep applications up and running optimally.

DevOps is a high-stakes world, but done well, it delivers the agility and performance to significantly impact business competitiveness.

@ThingsExpo Stories
Roberto Medrano, Executive Vice President at SOA Software, had reached 30,000 page views on his home page - http://RobertoMedrano.SYS-CON.com/ - on the SYS-CON family of online magazines, which includes Cloud Computing Journal, Internet of Things Journal, Big Data Journal, and SOA World Magazine. He is a recognized executive in the information technology fields of SOA, internet security, governance, and compliance. He has extensive experience with both start-ups and large companies, having been involved at the beginning of four IT industries: EDA, Open Systems, Computer Security and now SOA.
The industrial software market has treated data with the mentality of “collect everything now, worry about how to use it later.” We now find ourselves buried in data, with the pervasive connectivity of the (Industrial) Internet of Things only piling on more numbers. There’s too much data and not enough information. In his session at @ThingsExpo, Bob Gates, Global Marketing Director, GE’s Intelligent Platforms business, to discuss how realizing the power of IoT, software developers are now focused on understanding how industrial data can create intelligence for industrial operations. Imagine ...
We certainly live in interesting technological times. And no more interesting than the current competing IoT standards for connectivity. Various standards bodies, approaches, and ecosystems are vying for mindshare and positioning for a competitive edge. It is clear that when the dust settles, we will have new protocols, evolved protocols, that will change the way we interact with devices and infrastructure. We will also have evolved web protocols, like HTTP/2, that will be changing the very core of our infrastructures. At the same time, we have old approaches made new again like micro-services...
Every innovation or invention was originally a daydream. You like to imagine a “what-if” scenario. And with all the attention being paid to the so-called Internet of Things (IoT) you don’t have to stretch the imagination too much to see how this may impact commercial and homeowners insurance. We’re beyond the point of accepting this as a leap of faith. The groundwork is laid. Now it’s just a matter of time. We can thank the inventors of smart thermostats for developing a practical business application that everyone can relate to. Gone are the salad days of smart home apps, the early chalkb...
Operational Hadoop and the Lambda Architecture for Streaming Data Apache Hadoop is emerging as a distributed platform for handling large and fast incoming streams of data. Predictive maintenance, supply chain optimization, and Internet-of-Things analysis are examples where Hadoop provides the scalable storage, processing, and analytics platform to gain meaningful insights from granular data that is typically only valuable from a large-scale, aggregate view. One architecture useful for capturing and analyzing streaming data is the Lambda Architecture, representing a model of how to analyze rea...
SYS-CON Events announced today that Vitria Technology, Inc. will exhibit at SYS-CON’s @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Vitria will showcase the company’s new IoT Analytics Platform through live demonstrations at booth #330. Vitria’s IoT Analytics Platform, fully integrated and powered by an operational intelligence engine, enables customers to rapidly build and operationalize advanced analytics to deliver timely business outcomes for use cases across the industrial, enterprise, and consumer segments.
Today’s enterprise is being driven by disruptive competitive and human capital requirements to provide enterprise application access through not only desktops, but also mobile devices. To retrofit existing programs across all these devices using traditional programming methods is very costly and time consuming – often prohibitively so. In his session at @ThingsExpo, Jesse Shiah, CEO, President, and Co-Founder of AgilePoint Inc., discussed how you can create applications that run on all mobile devices as well as laptops and desktops using a visual drag-and-drop application – and eForms-buildi...
Containers and microservices have become topics of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 16th Cloud Expo at the Javits Center in New York June 9-11 will find fresh new content in a new track called PaaS | Containers & Microservices Containers are not being considered for the first time by the cloud community, but a current era of re-consideration has pushed them to the top of the cloud agenda. With the launch of Docker's initial release in March of 2013, interest was revved up several notches. Then late last...
SYS-CON Events announced today that Dyn, the worldwide leader in Internet Performance, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Dyn is a cloud-based Internet Performance company. Dyn helps companies monitor, control, and optimize online infrastructure for an exceptional end-user experience. Through a world-class network and unrivaled, objective intelligence into Internet conditions, Dyn ensures traffic gets delivered faster, safer, and more reliably than ever.
In their session at @ThingsExpo, Shyam Varan Nath, Principal Architect at GE, and Ibrahim Gokcen, who leads GE's advanced IoT analytics, focused on the Internet of Things / Industrial Internet and how to make it operational for business end-users. Learn about the challenges posed by machine and sensor data and how to marry it with enterprise data. They also discussed the tips and tricks to provide the Industrial Internet as an end-user consumable service using Big Data Analytics and Industrial Cloud.
The explosion of connected devices / sensors is creating an ever-expanding set of new and valuable data. In parallel the emerging capability of Big Data technologies to store, access, analyze, and react to this data is producing changes in business models under the umbrella of the Internet of Things (IoT). In particular within the Insurance industry, IoT appears positioned to enable deep changes by altering relationships between insurers, distributors, and the insured. In his session at @ThingsExpo, Michael Sick, a Senior Manager and Big Data Architect within Ernst and Young's Financial Servi...
Performance is the intersection of power, agility, control, and choice. If you value performance, and more specifically consistent performance, you need to look beyond simple virtualized compute. Many factors need to be considered to create a truly performant environment. In his General Session at 15th Cloud Expo, Harold Hannon, Sr. Software Architect at SoftLayer, discussed how to take advantage of a multitude of compute options and platform features to make cloud the cornerstone of your online presence.
Even as cloud and managed services grow increasingly central to business strategy and performance, challenges remain. The biggest sticking point for companies seeking to capitalize on the cloud is data security. Keeping data safe is an issue in any computing environment, and it has been a focus since the earliest days of the cloud revolution. Understandably so: a lot can go wrong when you allow valuable information to live outside the firewall. Recent revelations about government snooping, along with a steady stream of well-publicized data breaches, only add to the uncertainty
The explosion of connected devices / sensors is creating an ever-expanding set of new and valuable data. In parallel the emerging capability of Big Data technologies to store, access, analyze, and react to this data is producing changes in business models under the umbrella of the Internet of Things (IoT). In particular within the Insurance industry, IoT appears positioned to enable deep changes by altering relationships between insurers, distributors, and the insured. In his session at @ThingsExpo, Michael Sick, a Senior Manager and Big Data Architect within Ernst and Young's Financial Servi...
PubNub on Monday has announced that it is partnering with IBM to bring its sophisticated real-time data streaming and messaging capabilities to Bluemix, IBM’s cloud development platform. “Today’s app and connected devices require an always-on connection, but building a secure, scalable solution from the ground up is time consuming, resource intensive, and error-prone,” said Todd Greene, CEO of PubNub. “PubNub enables web, mobile and IoT developers building apps on IBM Bluemix to quickly add scalable realtime functionality with minimal effort and cost.”
Docker is an excellent platform for organizations interested in running microservices. It offers portability and consistency between development and production environments, quick provisioning times, and a simple way to isolate services. In his session at DevOps Summit at 16th Cloud Expo, Shannon Williams, co-founder of Rancher Labs, will walk through these and other benefits of using Docker to run microservices, and provide an overview of RancherOS, a minimalist distribution of Linux designed expressly to run Docker. He will also discuss Rancher, an orchestration and service discovery platf...
Sensor-enabled things are becoming more commonplace, precursors to a larger and more complex framework that most consider the ultimate promise of the IoT: things connecting, interacting, sharing, storing, and over time perhaps learning and predicting based on habits, behaviors, location, preferences, purchases and more. In his session at @ThingsExpo, Tom Wesselman, Director of Communications Ecosystem Architecture at Plantronics, will examine the still nascent IoT as it is coalescing, including what it is today, what it might ultimately be, the role of wearable tech, and technology gaps stil...
With several hundred implementations of IoT-enabled solutions in the past 12 months alone, this session will focus on experience over the art of the possible. Many can only imagine the most advanced telematics platform ever deployed, supporting millions of customers, producing tens of thousands events or GBs per trip, and hundreds of TBs per month. With the ability to support a billion sensor events per second, over 30PB of warm data for analytics, and hundreds of PBs for an data analytics archive, in his session at @ThingsExpo, Jim Kaskade, Vice President and General Manager, Big Data & Ana...
CommVault has announced that top industry technology visionaries have joined its leadership team. The addition of leaders from companies such as Oracle, SAP, Microsoft, Cisco, PwC and EMC signals the continuation of CommVault Next, the company's business transformation for sales, go-to-market strategies, pricing and packaging and technology innovation. The company also announced that it had realigned its structure to create business units to more directly match how customers evaluate, deploy, operate, and purchase technology.
In the consumer IoT, everything is new, and the IT world of bits and bytes holds sway. But industrial and commercial realms encompass operational technology (OT) that has been around for 25 or 50 years. This grittier, pre-IP, more hands-on world has much to gain from Industrial IoT (IIoT) applications and principles. But adding sensors and wireless connectivity won’t work in environments that demand unwavering reliability and performance. In his session at @ThingsExpo, Ron Sege, CEO of Echelon, will discuss how as enterprise IT embraces other IoT-related technology trends, enterprises with i...