The Market for AIOps Solutions is Ready for Takeoff

While AIOps as a technology category is still in its relative infancy, there are signs that it is poised for rapid growth. In this post, I will look at growth signals from three sources: industry analysts, enterprise IT organizations, and vendors.

What are the analysts saying?

According to Gartner, 40% of organizations expect to have strategically implemented an AIOps platform to enhance performance monitoring by 2022. Further, Gartner predicts that large enterprise exclusive use of AIOps and digital experience monitoring tools will rise from 5% in 2018 to 30% in 2023. “IT leaders are enthusiastic about the promise of applying AI to IT operations, but as with moving a large object, it will be necessary to overcome inertia to build velocity”, said Padraig Byrne, Senior Director Analyst at Gartner. “The good news is that AI capabilities are advancing, and more real solutions are becoming available every day.”

This translates into a global AIOps solution market that is expected to grow from USD 2.55 billion in 2018 to USD 11.02 billion by 2023, according to MarketsandMarkets™.  This represents a Compound Annual Growth Rate (CAGR) of 34.0% during the forecast period (2018–2023).

What’s driving Enterprise IT?

Customers tell us that business disruptions are becoming increasingly costly and service-level expectations are increasing as a result. At the same time, demands on IT Operations are accelerating due to the growth of IT complexity, digitalization, and other strategic initiatives such as Cloud migrations and M&A integrations. Our customers also believe that they cannot keep growing their IT resources to keep up. This is consistent with 451research.com [2018] data, which shows that IT infrastructure teams are seeing a 64% increase in work with no change in the number of staff. So, it should come as no surprise that 86% of IT Ops professionals think that by 2020 their organizations would need intelligent automation to keep up with business requirements [Lawless Research]. These requirements include the ability to better manage incident alert fatigue, make sense of the growing amount of incident and metric data, and more proactively remediate system performance and availability problems.

Enterprises are increasingly looking to AIOps for answers. This was evident in the turnout for a recent ASUG (Americas SAP User Group) community webcast entitled “Three Next Practices that Leverage AI/ML to Optimize SAP Application Performance” that FogLogic presented with global bio-pharma leader Boehringer-Ingelheim. During the webcast – which attracted ~250 registrants – we asked enterprises “What best describes where your company is in its AIOps journey?” Not surprisingly, most are still in the early educational phase, and 75% are just getting started. But virtually all respondents to a subsequent question saw potential from AIOps in areas like improved alerting, smarter root cause analysis, and workflow automation. Less than 3% felt existing tools are good enough (see chart below). The general sentiment is that legacy tools won’t cut it moving forward and the future is AIOps.  

 

What are vendors up to?

A recent industry research report listed over 20 AIOps vendors. However, we know of another 10-15 vendors who claim to offer an AIOps tool that didn’t even appear on that analyst’s radar. No matter how you define who is and who is not an AIOps vendor, the large number of vendors claiming the AIOps mantle is a clear indication that the market is poised for growth.

Enterprises will find it a challenge to understand how the various solution options are positioned. Solution segmentation dimensions may include:

  • Native AI technology versus AI added on after product maturity
  • SaaS solutions versus on-premise or hybrid tools
  • Solutions versus development platforms
  • Application layer versus infrastructure focus
  • Domain-aware contextualization versus pure data-driven AI

For example, if your focus is on application performance monitoring, anomaly detection, and alerting, several mature APM vendors are adding AI capability and repositioning their offerings as AIOps (e.g. AppDynamics). If you want to leverage a single vendor to apply AIOps capabilities to a broad array of problems, development platform providers like Splunk offer you the ability to build to suit.

FogLogic believes AIOps is most effective as an out-of-the-box SaaS solution that leverages application domain knowledge to provide highly contextualized insights from data collected across the stack. Consequently, we have built FogLogic to be a domain-aware, “AIOps In-a-Box™” extendable SaaS solution for enterprise applications that is available today for SAP environments.

And, what about you?

While it may be comforting or unsettling to learn what analysts, industry peers, and vendors are saying and doing, it only really matters what you are planning to do with AIOps. A good place to start is to check out our educational resources on IT Ops pain points and solutions and our self-assessment guide: Are your Ready for AIOps?

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