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Remote IT Monitoring, Cloud Cybersecurity Strategies: How MSPs May Evolve

Within the traditional MSP market, demand for RMM (remote monitoring and management) software remains strong. But how might managed IT service providers (MSPs) evolve to more effectively support cloud infrastructure, cloud applications and associated cybersecurity needs?

New clues continue to surface from Datadog, a fast-growing provider of SaaS-based monitoring tools that can track on-premises and cloud services. The company's latest move: Launching Datadog Cloud Security Platform, which allows customers and partners to "correlate security insights with monitoring data across infrastructure, network and application tiers," Datadog says.

At least initially, the Datadog Cloud Security Platform is not primarily designed for MSPs and MSSPs, a spokesperson for the company tells MSSP Alert. Still, there are some MSSPs that are looking to build integrations and partnerships through the Datadog Partner Network, the spokesperson adds.

RMM and Cloud Monitoring Software: Growth Rate Clues

To be clear, MSPs continue to flock to established RMM software tools. N-able, for instance, generated revenue of $85.2 million in Q2 of 2021, up 16.1 percent from Q2 of 2020, the MSP software provider disclosed earlier this week. It's a safe bet much of that growth involved N-able's RMM and N-central tools.

Still, demand for cloud monitoring tools across Amazon Web Services, Microsoft Azure and Google Cloud Platform is surging up in the enterprise. To wit, Datadog's revenue was $233.5 million in the company's Q2 of 2021, up 67 percent from Q2 of 2020.

Datadog extended from infrastructure monitoring to application performance monitoring (APM) back around 2016, triggering a Datadog vs. New Relic showdown. Fast forward to present day, and Datadog is on the move again -- this time in the cybersecurity market.

Datadog Cloud Security Platform Details

Indeed, the company this week unveiled the Datadog Cloud Security Platform. It includes:

  • Cloud security posture management (CSPM), which allows customers to track whether production environments comply with industry standards, such as PCI DSS, SOC 2 and HIPAA, and also catches misconfigurations that could introduce vulnerabilities, Datadog says.
  • Cloud workload security (CWS) functionality, which monitors file and process activity across environments to help catch host and infrastructure-based attacks, the company adds.
  • Security monitoring via a security information and event management (SIEM).
  • Application security, currently in beta, provides protection against application-level threats by identifying and blocking attacks that target code-level vulnerabilities, such as SQL injections and cross-site scripting (XSS) exploits, Datadog asserts.
  • Unified observability and security reporting.

Datadog Partner Program: Promising Start, But...

Yes, Datadog has a partner program. It includes tracks for resellers, MSPs and consultants/systems integrators. Poke around the MSP market, and you'll find Datadog partners service midmarket and enterprise customers. Still, there's more room for improvement.

For instance, Datadog CEO Olivier Pomel didn't say much about the company's partner strategy on an earnings call this week. Also, the new Datadog Cloud Security Platform is not quite designed for MSPs and MSSPs. That's unfortunate. As more businesses outsource IT and cloud monitoring to MSPs, software and cloud companies should have multi-tenant partner designs in place from Day One, ChannelE2E believes.

Still, anecdotal evidence suggests cloud monitoring tool providers are in growth mode with MSPs. And the momentum extends from cloud infrastructure to applications and now cybersecurity.

Moreover, SaaS application monitoring, management and security tools -- from such MSP-centric companies as SaaS Alerts and Augmentt -- are on the rise, anecdotal evidence heard by ChannelE2E suggests.

Bottom line? RMM software continues to evolve past PC and server monitoring to increasingly support various SaaS opportunities. But if you look up in the enterprise, you may spot fast-growth companies like Datadog gaining momentum with MSPs. And in the SMB segment, keep an eye on those SaaS application monitoring tools...

Additional insights from Sharon Florentine.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.