Application Performance Monitoring Global Market Report 2024

The application performance monitoring market size has grown rapidly in recent years. It will grow from $8.56 billion in 2023 to $9.66 billion in 2024 at a compound annual growth rate (CAGR) of 12.8%. The growth observed in the historical period can be attributed to several factors. These include the increasing complexity of IT environments, a growing demand for user satisfaction, a rise in digital transformation initiatives, the need for risk mitigation and prevention of downtime, and the overall escalation in application complexity. These factors collectively contributed to the increased adoption and significance of Application Performance Monitoring (APM) during the historic period.

The application performance monitoring market size is expected to see rapid growth in the next few years. It will grow to $15.49 billion in 2028 at a compound annual growth rate (CAGR) of 12.5%. The anticipated growth in the forecast period can be attributed to a growing emphasis on cloud computing, the widespread adoption of microservices architecture, an increased focus on proactive performance management, the globalization of business operations and distributed workforces, and the integration of Application Performance Monitoring (APM) with DevOps practices. Major trends expected in the forecast period encompass the rise of observability platforms, the integration of application security measures, the adoption of real-time analytics for performance monitoring, a heightened focus on business impact analysis, and increased collaboration with DevOps practices. These trends collectively contribute to the projected growth and advancements in the field of Application Performance Monitoring in the forecasted period.

The escalating demand for cloud and mobile computing is poised to drive significant growth in the application performance monitoring (APM) market. Cloud computing involves providing diverse computing services over the internet, encompassing storage, processing power, and applications, while mobile computing enables access and interaction with digital information via portable devices. APM plays a crucial role in optimizing application performance and ensuring an excellent user experience within the realms of cloud and mobile computing. For instance, as reported by Eurostat in December 2021, 41% of organizations utilized cloud computing services in 2021, marking a 5.0 percentage-point increase from the preceding year, signifying the growing traction of cloud and mobile computing. Consequently, the burgeoning demand for these technologies is set to propel the application performance monitoring market.

The rising adoption of microservice architecture is anticipated to be a key driver fueling the expansion of the application performance monitoring market. Microservices architecture involves breaking down complex applications into smaller, loosely coupled, and independently deployable services, a methodology widely employed in cloud and mobile computing environments. Efficient monitoring and management of application performance, integral to these computing paradigms, necessitate the utilization of application performance monitoring services. For example, as reported by Codeit in November 2022, a notable 81.5% of companies are already utilizing microservices, with an additional 17.5% planning to transition to this architecture type, highlighting the increasing adoption rate. Hence, the growing embrace of microservice architecture is a driving force behind the expansion of the application performance monitoring market.

The steep cost associated with application performance monitoring (APM) solutions and services poses a notable challenge, potentially impeding market growth during the forecast period. Implementing APM solutions demands substantial investments in software, hardware, and skilled personnel for effective setup and operation. This expense can pose a barrier, particularly for small and medium-sized enterprises (SMEs) that might find it challenging to allocate the necessary resources for these solutions. For instance, as reported by ScoutAPM in January 2023, APM solutions tailored for small to mid-sized businesses typically range between $200 and $300 per month for a single application, underscoring the cost burden for enterprises. Consequently, the high cost factor acts as a hindrance to the expansion of the application performance monitoring market.

Leading enterprises in the application performance monitoring market are actively driving innovation to fortify their market position by introducing advanced solutions such as APM 360, focusing on ensuring reliable customer service. APM 360 represents a cloud-based asset performance management solution encompassing overall asset health, predictive maintenance, and real-time condition monitoring. For example, in June 2023, New Relic Inc., a US-based web tracking and analytics company, unveiled New Relic APM 360, heralded as the next evolution in application performance monitoring (APM). This solution transcends incident troubleshooting, offering comprehensive performance, security, and development insights for engineers. APM 360 seamlessly integrates critical telemetry data across the application stack and development lifecycle, encompassing deployment modifications, crucial transactions, service-level objectives (SLOs), logs, infrastructure failures, security measures, and debugging functionalities. By providing a unified view of system health to engineering teams and bridging instrumentation gaps, APM 360 enhances platform adoption and data flow within the system, fostering a more comprehensive understanding of application performance.

In April 2021, Netreo Inc., a renowned US-based provider of cloud-based IT infrastructure monitoring solutions, completed the acquisition of Stackify LLC for an undisclosed sum. This strategic acquisition was aimed at bolstering and broadening Netreo's spectrum of full-stack IT monitoring services and Artificial Intelligence for IT Operations by integrating Stackify's specialized application performance monitoring (APM) capabilities. The inclusion of Stackify's APM features, tailored for developers and DevOps, significantly enhances the observability functions essential to address the increasing demand for comprehensive IT operations management software. Stackify LLC, a prominent US-based provider of Software as a Service application performance monitoring solutions, brings a wealth of expertise and tailored solutions to augment Netreo's suite of offerings.

Major companies operating in the application performance monitoring market report are International Business Machines Corporation (IBM), Oracle Corporation, Wavefront Technology Solutions Inc., Splunk Inc., Micro Focus International plc, Datadog Inc., Dynatrace Inc., Elastic NV, Quest Software Inc., New Relic Inc., Riverbed Technology LLC, SolarWinds Corp, Ensono Limited., Nexthink SA, AppDynamics, Coralogix Ltd., AppNeta Inc., Honeycomb.io, Catchpoint Systems Inc., Lightstep Inc., Aternity Inc., Site24x7, Nagios Enterprises LLC, Sematext Group Inc., Prometheus Group Enterprises LLC.

North America was the largest region in the application performance monitoring market in 2023. Asia-Pacific is expected to be the fastest-growing region in the forecast period. The regions covered in the application performance monitoring market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa The countries covered in the application performance monitoring market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Canada, Italy, Spain.

The application performance monitoring market consists of revenues earned by entities by providing monitoring, visualization, alerts, analytics, and full-stack visibility. The market value includes the value of related goods sold by the service provider or included within the service offering. The application performance monitoring market also includes sales of sensors, computer, and memory storages. Values in this market are ‘factory gate’ values, that is the value of goods sold by the manufacturers or creators of the goods, whether to other entities (including downstream manufacturers, wholesalers, distributors and retailers) or directly to end customers. The value of goods in this market includes related services sold by the creators of the goods.

The primary components in application performance monitoring encompass software and services. Software comprises a set of instructions, data, or computer programs employed to operate computers and execute various activities. Deployments of APM solutions can be either cloud-based or on-premises, catering to the needs of small and medium enterprises (SMEs) as well as large enterprises. Various applications within APM include synthetic monitoring, end-user monitoring, mobile monitoring, and others. These applications find utility across multiple industries, including Banking, Finance, and Insurance (BFSI), IT and Telecom, Retail and E-commerce, Healthcare, Education, Media and Entertainment, Manufacturing, and others.

The application performance monitoring market research report is one of a series of new reports that provides application performance monitoring market statistics, including application performance monitoring industry global market size, regional shares, competitors with an application performance monitoring market share, detailed application performance monitoring market segments, market trends and opportunities, and any further data you may need to thrive in the application performance monitoring industry. This application performance monitoring market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenario of the industry.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).

The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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