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AppDynamics Acquisition: Just the Tip of the IT Analytics Iceberg

Arif Kareem, CEO, ExtraHop Networks

Arif Kareem, CEO, ExtraHop Networks

Yesterday Cisco announced that it has acquired leading application performance monitoring vendor AppDynamics. The acquisition came as something of a surprise. In late December, AppDynamics filed for an IPO, and the company was expected to go public this week. The eleventh hour deal -- according to TechCrunch, the decision was made 48 hours before the announcement -- valued the company at $3.7 billion, nearly double the IPO valuation.

While the exit has changed, the significance of the event still holds true. Like Splunk and New Relic (both of which IPO'd in recent years), AppDynamics is an innovator in the emerging IT analytics market that is disrupting the traditional IT operations management & monitoring model.

What these exits tell us is that IT analytics is not a flash in the pan. It's not a fad. We're witnessing a major shift with IT teams recognizing the need to be data driven, putting significant pressure on status quo monitoring approaches. When an enterprise IT heavyweight like Cisco makes a quick, high-value acquisition, it's time to stand up and take notice.

A Market In Transition

The common approach to performance monitoring is extremely siloed. Network performance monitoring covers the network. Application performance covers monolithic applications. These tools exist in vacuums and are often chained to teams of specialists rather than broadly utilized. Instead of being used to proactively improve overall IT performance and operations, they are dedicated to a single purpose and used reactively to fight fires and prove innocence.

But the fundamental expectations of IT are changing. Now more than ever, IT is foundational to nearly every aspect of a business, from the way employees get work done to how customers interact with the organization. These technology-driven interactions, consisting of a wide range of distributed services hosted on-prem and in the cloud, are the building blocks of the digital experience. A bad digital experience – even a mediocre one – can send customers fleeing to the competition. If you're troubleshooting the problem when your payment processing system is slow (or already down) on Cyber Monday, or when a doctor cannot access a patient's electronic health record during an ER visit, you're already too late.

If slow time is the new downtime, what are world's most innovative companies doing? They're moving to a fundamentally different, more proactive approach, by focusing on situational awareness (what's happening now) and operational intelligence (what's happened in the past) to support a seamless experience for both internal and external consumers of digital services.

And what's delivering this situational awareness and operational intelligence? IT Analytics.

Wire Data: the Next Breakout Source of Insight

The difference between IT Analytics and legacy technology categories is the volume, quality, and aperture of the data they can collect across the application delivery chain. IT Analytics goes far beyond traditional performance monitoring, not just surfacing up/down application metrics or top network talkers and capturing packets, but providing real-time visibility into digital experiences and the transactions that support them.

At ExtraHop, we believe the next catalyst for data driven IT is wire data. In today's digital economy, there is one common denominator between all IT systems: the wire. Every digital interaction transacts on the wire. The ability to monitor those interactions transforms the network from a transport to the foundational pillar of real-time digital experience. As the value of IT data as a business driver continues to gain hold, wire data is poised to be the next transformative source of insight for the enterprise.

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