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IBM buys observability vendor Instana

IBM intends to purchase Instana, maker of application monitoring and observability tools, and then couple its technology with the Watson AIOps portfolio.

IBM will buy application performance monitoring and observability vendor Instana as part of its bid to serve enterprises pursuing hybrid and multi-cloud strategies.

The acquisition is expected to close within several months, according to IBM. Terms were not disclosed.

Instana's software automatically monitors and gathers performance information about application components running on public and private clouds, mobile devices and on-premises environments, including IBM's Z system mainframes. It competes with products such as Cisco AppDynamics as well as entries from New Relic, Splunk and Oracle.

Observability is a successor of sorts to traditional application monitoring. It places an emphasis on more complex queries against varied sets of IT telemetry data as software complexity grows due to microservices architectures and other trends.

IBM plans to integrate Instana's technology with its Watson AIOps portfolio. Information collected by Instana will be used to trigger AI-powered alerts, helping teams resolve problems quickly, IBM said in a statement.

Big Blue rolled out Watson AIOps in May during its Think conference. Having largely ceded the public cloud market to AWS, Microsoft and Google, IBM is now focused on supporting hybrid and multi-cloud scenarios through its $34 billion acquisition of Red Hat, which offers the popular OpenShift container management platform.

The Instana acquisition comes after IBM's July purchase of WDG Automation, a robotic process automation vendor based in Brazil.

Instana was founded in 2015 and is based in Chicago. Its technology can collect billions of metrics per day in real time, according to IBM. It's available as SaaS, as well as for on-premises deployments.

On the product integration front, the companies have a head start, as Instana's software already supports monitoring applications deployed on OpenShift.

Instana looks like it has solid technology, but I tend to look at these acquisitions as Instana gaining instant credibility now that they are a part of IBM.
Bob LaliberteAnalyst, Enterprise Strategy Group

"Instana looks like it has solid technology, but I tend to look at these acquisitions as Instana gaining instant credibility now that they are a part of IBM," said Bob Laliberte, an analyst at Enterprise Strategy Group. "Tying that into WatsonAIOps also helps." Instana's support for mainframes is a key feature given the platform's continued importance for IBM, he added.

IBM recently announced plans to spin off its infrastructure services arm into a new company in order to focus on opportunities in hybrid cloud and AI. The purchase of Instana ties directly into this strategy, said Holger Mueller, an analyst at Constellation Research.

"If your ambition is to manage hybrid cloud, as it is for IBM, instrumentation to enable a single pane of glass is key for enterprises to observe and manage their next-gen apps," he said. "This is how Instana will fit into the IBM portfolio for hybrid cloud."

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