Cloud Service Providers Embrace Application Performance Management (APM)

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Cloud service providers (CSPs) are jumping on the application performance management (APM) wave to bolster their customer experience (CX) initiatives. The big question: When will MSPs and VARs wake up to the application performance management movement?

Generally speaking, APM allows service providers and developers to quickly find an troubleshoot performance problems with on-premises and cloud applications. Demand for APM -- particularly among CSPs -- is growing rapidly.

Key APM leaders include AppDynamics and New Relic. While AppDynamics appears to be gearing up for an IPO, New Relic already is growing quickly as a publicly held company. Indeed, New Relic revenues were $58.6 million in Q1 2016, up 54 percent from the corresponding quarter last year, the company said yesterday.

CSPs Embrace APM

CSPs have been key to New Relic's growth. "We continue to partner with leading public and private cloud providers to help companies ensure the success of their applications," said Hilarie Koplow-McAdams, president of New Relic, during an earnings call yesterday.

New Relic's key CSP partners include Pivotal -- part of the EMC Federation of companies. Many Pivotal Cloud Foundry customers across financial services, retail and consumer packaged goods are considering New Relic as a solution to monitor their applications, Koplow-McAdams added.

"We've been lucky to have Pivotal as both a customer and a partner for several years and this past quarter we expanded our relationship with them," she said. "We share a vision to help the world's leading companies transform into software-driven businesses."

APM: Where Are VARs, MSPs?

Meanwhile, VARs and MSPs are somewhat late to the application performance management (APM) conversation, ChannelE2E believes. Many VARs and MSPs have embraced RMM (remote monitoring and management) of servers, desktops and mobile devices, but the vast majority of those channel partners aren't focusing on the application monitoring layer.

That certainly could change in the months ahead. The parent company of SolarWinds MSP (owner of LogicNow and N-able) for instance, has a range of APM tools that could eventually reach MSPs. Somewhat similarly, CA Inc. has a Unified Information Management (UIM) platform that offers a range of RMM and APM capabilities -- which is especially important for CA's Application Economy strategy.

VARs, meanwhile, could likely generate new revenues by reselling APM into corporate IT accounts. Target customers could include DevOps teams that are responsible for rolling out and optimizing applications as part of a continual software development strategy.

Still, CSPs appear to have first-mover advantage in the current APM market wave. That should be a wakeup call for VARs and MSPs that are looking to push beyond traditional IT monitoring and management services.




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.