Friday, June 19, 2015

Dynatrace Growth Misinformation

For my valued readers: I wanted to point out some issues I’ve recently seen in the public domain. As a Gartner analyst, I heard many claims about 200% growth, and all kind of data points which have little basis in fact. When those vendors are asked what actual numbers they are basing those growth claims on, often the questions are dodged.

Dynatrace, recently used the Gartner name and brand in a press release.

I want to clarify the issues in their statements based on the actual Gartner facts published by Gartner in its Market Share data:

Dynatrace says in their press release:
“expand globally with more than three times the revenue of other new generation APM vendors”

First, let’s look at how new the various technologies are:
  1. Dynatrace Data Center RUM (DCRUM) is based on the Adlex technology acquired in 2005, but was created in the late 1990s. The DCRUM architecture has largely unchanged since the acquisition. The UI however has evolved over time.
  2. Dynatrace Synthetic Monitoring is based on the acquisition of Gomez in 2009; that technology was similarly built in the late 1990s. The user interface has evolved, along with the use of the technologies acquired with Proxima technologies in 2007 to use for Business Service Management (BSM). Dynatrace did try to sell BSM for several years, but has moved away from that; they do still however use the technology within their synthetic monitoring solution..
  3. Dynatrace Application Monitoring was acquired ($256m) in 2011, and also has a separate user interface.
  4. Ruxit is an organically developed and modern offering with a modern user interface, which was released in 2014.
  5. It was announced this week that Keynote will be merging into Dynatrace Synthetic, giving yet another user interface for synthetic monitoring which was developed in the 1990s.

These products are not modern. Dynatrace is not a “new generation” company, as in reality much of its revenue comes from technologies more than a decade old. Ruxit is clearly a “new generation” product, but has little revenue since it’s  a new offering which is SaaS only.

“Dynatrace’s 2014 growth rate increased to 20.6%, nearly three times higher than the previous year’s growth and 24% faster than the overall global APM market.”

According to Gartner market data (“Market Share: All Software Markets, Worldwide, 2014”) Dynatrace’s growth rate in 2013 was 20.5%, while the overall APM market grew only 13%

In 2014, the Gartner published growth rate for Dynatrace was 20.6%, while the overall market grew 15.8%. So it can be approximated that three-quarters of Dynatrace’s growth was the overall growth of the market, from which all APM vendors benefited. Based on this, a reasonable inference is that Dynatrace’s growth numbers benefitted substantially as a result of the overall market growth in these periods.

Wanted to set the record straight, and use the data to shed some additional light on the Dynatrace press release.

Disclaimer: This is my personal website and reflects my views and opinions only. Any comments made on this website by myself or by third parties do not necessarily reflect views or opinions of my employer.


Anonymous said...

Dynatrace is clearly the leader in the APM Market. There is no disputing that at all.

Anonymous said...

What nonsense from this joker Jonah.

Anonymous said...

Hey Jonah - Let's see if you have the chutzpah in that same upcoming blog post to point out that you overstated your current employer's revenue in the prior market share report by 80%. Or you can reveal your true colors. Perfect time for a mea culpa though.

Anonymous said...

The numbers in the Dynatrace press release are directly from Gartner's recent report on APM Market Share. If you are going to attack the numbers you are really attacking your former employer....Strange.

Jonah Kowall said...

I never did the market data numbers, there are other analysts. That being said the error was corrected which used Bookings versus Revenue.

Why don't you use your real name versus "Anonymous" Robbie?

The analysis in the PR was clearly false and misleading, you'll see a correction coming. I explained the growth rates in this post based on the numbers. More coming too!

Anonymous said...

Jonah - Your name is on that report, would love to hear how you are not accountable for the numbers.

"Market Share Analysis: Application Performance Monitoring, 2013
28 May 2014
Analyst(s): Federico De Silva | Jonah Kowall"

Jonah Kowall said...

Robbie : the market data numbers are posted in this spreadsheet by the analysts within former dataquest, it's a vendor focused side of Gartner, not Gartner for IT Leaders (which is where I worked).

Here is the 2013 version:

The market data analysis just uses that raw data.

Nicolas ROBBE said...

Jonah, for the record, i'm not the one with whom you're having a conversation here. I don't post as anonymous.

Anonymous said...

Wow ... after artificially pumping up AppDynamics during your tenure at Gartner and then going to work there, it is just stunning that you would make any comment about anything surrounding Gartner. Svengali maybe, technology mastermind ... not so much. And I'm not sure a product built on the CA Wily code base with a Flash UI is "modern".

Jonah Kowall said...

Sorry about that Robbie, my bad.

Charles : Artificially, hmmm. Interesting comment there. The miscalculation was explained in the research which was published. I have a good relationship with Gartner, I do appreciate your personal attacks, it's very mature. I will not engage in those myself.

The product has very little flash left, in fact if you test out the recent release this week you'll see almost none left. We will have none in the next release.

I'm glad you have to hide your identity, way to own your comments.