Cloud-Native Application Monitoring Platforms, Global, 2024-2029

Rapid Adoption of Cloud-Native Technologies Fuels Demand

The use of cloud-native technologies, such as containers and Kubernetes (K8s), has enabled a faster application development and delivery process and more efficient resource usage. However, it also introduced a level of operational complexity that traditional application monitoring tools are not equipped to solve as it has not been designed to address the challenges around the complexity of cloud-native environments, nor has it been designed to provide insights across an extremely dynamic infrastructure.

Cloud-native application monitoring platforms have emerged as the solution. They provide in-depth visibility on the performance, availability, and behavior of applications built and deployed in cloud-native environments and examine the performance across layers of the cloud-native stacks by collecting, processing, and analyzing telemetry data, such as metrics, logs, traces, and alerts, to ensure application performance, reliability, and security.

This study provides insight into the global cloud-native application monitoring platform market by vertical and horizontal. It offers a global breakdown and regional breakdowns for North America; Europe, the Middle East, and Africa; Latin America; and Asia-Pacific. The analysis covers drivers and restraints, revenue forecasts, pricing trends, competitive landscape trends, and insights for chief information security officers. It also identifies emerging growth opportunities that stakeholders and participants should consider and leverage. The base year is 2024, and the forecast period is from 2025 to 2029.

Revenue Forecast

The base year revenue estimate for the cloud-native application monitoring market is $8.54 billion, with a CAGR of 12.1% for the study period 2024-2029, reflecting robust growth in the cloud-native telemetry analytics space.

Scope of Analysis

• The study includes technology vendors that provide solutions that enable the monitoring and management of cloud-native applications. This involves the cloud-native application monitoring market which is rapidly evolving.
• Cloud-native application monitoring platforms should be able to collect, process, and analyze telemetry data such as metrics, logs, traces, and alerts to ensure application performance, reliability, and security, thus contributing significantly to the cloud-native application performance monitoring market.
• Revenues for cloud-native application monitoring platforms often overlap with broader observability and infrastructure monitoring, making it challenging to isolate pure cloud-native application monitoring platforms in both the cloud-native application monitoring market and cloud-native monitoring platform market.
• The study provides insights into the global market landscape in the cloud-native telemetry analytics market, with market trends and regional breakdowns of the markets in North America (NA), Europe, the Middle East, and Africa (EMEA), Asia-Pacific (APAC), and Latin America (LATAM). The study offers a breakdown of verticals and horizontals on a global level.
• Revenue for cloud-native application monitoring platforms in this study includes software licensing and service subscription while excluding professional services. The study derives information and insights from the analyst's secondary research and contributions from vendors, channel partners, and other industry stakeholders. However, all revenue estimates and forecasts are attributable to the analyst's analysis and modeling, particularly within the cloud monitoring tools market.

• Geographic Coverage: Global
• Study Period: 2023-2029
• Base Year: 2024
• Forecast Period: 2025-2029
• Monetary Unit: US dollar

The Impact of the Top 3 Strategic Imperatives on the Cloud-Native Application Monitoring Platforms Industry

Transformative Megatrends

Why

• In recent years, there has been massive migration to the cloud among organizations across all sizes and industries, further emphasizing the importance of the cloud-native application monitoring market.
• The migration was largely driven by the COVID-19 pandemic that forced organizations to adopt digital-first strategies and move away from legacy systems to remain competitive in the cloud-native telemetry analytics market.
• Today, many organizations now operate under a complex cloud environment that often spans in different cloud service providers (CSPs) and deployment models, increasing the reliance on cloud-native application performance monitoring tools.

The Analyst's Perspective

• Organizations now are increasingly becoming more reliant on cloud-native technologies such as containers and Kubernetes (K8s). With these technologies, applications can now be spun up and torn down in seconds, making traditional monitoring tools inadequate.
• As a result, organizations are now looking for cloud-native application monitoring platforms to gain visibility and performance insights, particularly in the cloud-native application performance monitoring market.

Geopolitical Chaos

Why

• Skyrocketing inflation, high interest rates, and a volatile geopolitical landscape have dominated the narrative in the past 12 to 24 months, affecting the cloud-native application monitoring platforms.
• The complicated economic and political situation has driven many organizations globally to realign their spending priorities and investment strategies, impacting the cloud-native application monitoring market.
• Many organizations are taking a more conservative approach to maintaining positive cash flow during this period of uncertainty, affecting investments in cloud-native telemetry analytics solutions.

The Analyst's Perspective

• Despite plans to cut back on new investments, tools such as cloud-native application monitoring platforms are set to continue to gain ground as applications become increasingly distributed, ephemeral, and complex.
• Monitoring and observability are no longer optional due to this and thus, organizations are looking for cloud-native application monitoring platforms to ensure uptime, performance, and security, a vital factor in the cloud monitoring tools market.

Disruptive Technologies

Why

• The cloud-native ecosystem is undergoing a significant transformation, driven by many factors such as security shifting to the left, open-source technologies, and in particular, the rise of generative AI (GenAI), influencing the cloud-native application performance monitoring market.
• The rise of GenAI is quickly transforming every part of the software lifecycle as its capabilities can now help to perform tasks such as summarizing incidents, generating remediation steps, and providing insights through natural language queries.

The Analyst's Perspective

• GenAI's increasing utilization in many organizations’ business operations is set to result in a higher frequency of deployment of cloud-native applications, resulting in an accelerated pace of application development and delivery process.
• Cloud-native application monitoring platforms are becoming essential not just to gain visibility and performance insights into cloud-native applications but also to maintain control and validate GenAI-driven changes in real-time, benefiting from the evolving cloud-native telemetry analytics market.

Competitive Environment

• Number of Competitors: At least 22
• Competitive Factors: Cost, performance, schedule, support, technology, reliability, contractor relationships, and customer relationships, particularly in the cloud-native application monitoring market.
• End-user Industry Verticals: Tech (Information technology [IT]/IT-enabled services and software development), BFSI, retail/eCommerce, healthcare & medical, service providers, and government, all increasingly relying on cloud-native monitoring platform solutions.
• Leading Competitors: Datadog, Dynatrace, New Relic, Microsoft, AWS, all key players in the cloud-native application monitoring market.
• Revenue Share of Top 5 Competitors (2024): 63.9%
• Other Notable Competitors: Cisco, BMC, Google Cloud, IBM, Grafana Labs, Elastic, all contributing to the growth of the cloud monitoring tools market.
• Distribution Structure: Direct sales, channel partners (distributors, MSSPs, SIs, and resellers), and cloud marketplaces within the cloud-native telemetry analytics space.
• Notable Acquisitions and Mergers: Cisco acquired Splunk, impacting the competitive landscape of the cloud-native application monitoring market.

Growth Drivers

• The rapid utilization of cloud-native applications has resulted in an urgent need to have an end-to-end visibility across dynamic environments, driving the demand for a centralized cloud-native application monitoring platform.
• The rising implementation of hybrid and multi-cloud strategies creates a fragmented view that traditional monitoring tools are not equipped to monitor, driving the demand for cloud-native application monitoring platforms.
• Stringent compliance requirements, including container-specific regulations, will drive the growth of cloud-native application monitoring platform solutions, as organizations need to comply to avoid legal and financial consequences, especially within the cloud-native monitoring platform market.
• The fast-paced digital landscape and rapidly evolving customer demand have transformed the application development and delivery process, resulting in a greater demand for a platform that can detect issues before applications are deployed, particularly in the cloud-native telemetry analytics space.

Growth Restraints

• The complex nature of cloud-native architecture has put off many organizations from investing in cloud-native application monitoring platforms, hampering market growth.
• The lack of cybersecurity professionals with the necessary expertise in cloud-native technologies is derailing market growth.
• Global economic turbulence is impacting planned investments for organizations across industries and sizes, hampering market growth, particularly in the cloud-native application monitoring market.
• Data sovereignty issues continue to plague cloud investments, raising concerns on the possibility of data being transferred out of country/region, affecting participation in the cloud-native application performance monitoring market.