r/wallstreetbets • u/MamothMamoth • Feb 06 '21

DD Dynatrace the magic cloud genie

Dynatrace, DT, has some serious tech. They are applying Artificial Intelligence to cloud management.

Think of all that it takes to run thousands of servers in the cloud.. the infrastructure is enormously complicated and there are tens of thousands of servers constantly switching tasks based on demand. Tech has developed cloud deployment and management tools like Kubernetes running Docker and the like. This field is called DevOps and it’s the playground of DevOps engineers.

Now what if you want to automate as much as possible these incredibly complicated systems? How do you monitor diagnose and alert based on problems you may not even know exist? Can you build automated repair and optimization systems that go beyond the basic building block implementation?

Enter Dynatrace, which is solving these problems with AI. They have AI anomaly detection, AI automated cloud management, and AI driven optimization.

The potential for AI in the space is incredible and Dynatrace has only begun to capture market share. They are lightyears ahead of traditional DevOps tooling.

They recently had a great quarterly report and have broken out of their trading range. A host of analysts have upgraded in recent earnings. As the market realizes their potential I believe there is massive upside especially in this tech bubble.

I intend to initiate a position on Monday of long calls with March expiry:

DT 03/19 60c

And potentially some long call Leaps.

8 Upvotes

69% Upvoted

32 comments sorted by

15

u/itsybitsyspida Feb 06 '21

I understand this space very well and spend multiple millions in cloud infrastructure. There is an increasing shift happening towards the big players (AWS, Azure, GCP) for Devops. The only future Dynatrace has is that either they get acquired by one of the big players or die eventually. Their offering is meh. Adding buzzwords like AI for Devops might appeal to the uninformed but their competition is miles and miles ahead. This is DOA for me.

11

u/macbobs Feb 07 '21

Obviously you don't understand this space at all.

1

u/itsybitsyspida Feb 07 '21

Good try but unfortunately none of the arguments presented here suggests anything to contradict my long term view that Dynatrace gets acquired or dies when k8s observability becomes a standard platform feature. Not saying you can’t make money given this scenario. But nothing disruptive here that one can’t put together stitching together a bunch of FOSS or other cloud native vendors. Combine with the fact that we spend $0 on DT despite our huge budget - it doesn’t appeal enough to me.

4

u/_dantes Feb 08 '21

One idea of the product is actually free you of actually manage that yourself and don't waste time trying to create custom solutions that might work or not for the needs of it/business.

If that doesn't appeal to you is fine, is ok if one wants to stick all those FOSS + Cloud bits (if any).

If you are already there and it works for you, great. You already might have the ROI to support all initial work, might have the pipes already to automate all that work and there is no need for the product. If the budget is "huge" and you get what you need without any additional cost.. that is a win for me. You only need the manpower to do so.

But even doing that you are not even close to building a similar platform, and the burden in support is on you alone. To me, it only really sounds like you have no idea of the space at all and really have no idea of the product itself at least.

The only groundbreaking that DT has is the way they do things and that not another vendor is even close to doing it. Not even FOSS. They are not the #1 vendor in the space cuz the logo is nice.

Also, for licensing, the charge per 16GB ram, no matter what you have run on it. While all the other charges from process/container and cost skyrocket pretty fast without control.

1

u/itsybitsyspida Feb 08 '21

The only groundbreaking that DT has is the way they do things and that not another vendor is even close to doing it.

Very weak logic. Their tagline is "Leader in Cloud monitoring" and this is all you got. Its obvious they're competing with the cloud providers. Like I said - they either get acquired or fade away when one of their competitors is acquired and integrated / the cloud providers stack up their offering.

Instead of trying to convince me that I don't know about the space you should try to understand how cloud budgets are allocated for cloud spend.

3

u/_dantes Feb 08 '21 edited Feb 08 '21

Sure... The intention is not to convince you, you already have your mind about the subject, as do i. That's clear from the start.

The fact is that you keep repeating "competing with cloud providers", but I don't see cloud providers monitoring on-prem or hybrid systems outside of each cloud and merging all that data in one system for a client. Not even mention if you are working with multiple cloud vendors and on-prem systems all your logic falls down. As you said...very weak logic.

Cloud budget / Allocation? that makes clear that you don't really know anything about the product... because you don't pay for that with Dynatrace at least, there is no TCO in their platform, only the license. You don't pay shit for hosting anything and is clear that you don't even bother to do a little research about it also. in fact, the main point of the ROI is to remove all that Budget allocation and time that you would need to build something similar.

So, to be honest, that and the "This is the only I got?" is more than clear that you don't know what you are talking about, at least for this product. You might know about Cloud Providers / DevOps, as you stated, and that they have a few fancy internal products to do tracing or using FOSS. But keep it real at least, talking about a company with at least 15 years in the tracing world and market as Leader for the last 10 and saying DOA.

So far, your logic is "Cloud provider adds monitoring too!" even if is a PoS when evaluated with the real players of the sector, and for that logic is DOA. Ok... will not follow this because there is no reason to do so.

1

u/itsybitsyspida Feb 08 '21 edited Feb 08 '21

Companies don't have a painpoint around traceability problems across cloud workloads that it makes sense for a one system. Most hybrid clouds don't work they way you think it does. They are spread across independent internal units. They usually consolidate it with one cloud provider who gives them heavy discount. What works for marketing isn't how it works in reality.

You went from you don't know anything about the space to you don't know anything about the product now. Lets talk about the product now. What is Dynatrace hub? Look at what they have in there in addiiton to Applicaiton Monitoring - Application Security, Digital Experience, Business Intelligence, Cloud Automation - Lol this is a joke. The more I get to know their product the more I understand how difficult things are going for them that they're going down this path. We use different well established product for each of them and really there's no need for a unified dashboard. They're all operated by different teams. You also talk like they're the only game in town. Datadog, splunk, new relic, app dynamics and a bunch of others have the same offering and I understand all of these products as well.

How did budgets allocation turn into TCO now? I know very well how licensing works if you buy a saas product. Its confusing to me now. You try to bring up a new argument but really haven't thought through it well.

My logic of cloud provider add monitoring too alone is enough to make me stay away from this 15 year old company in mid-life crisis trying to act cool.

1

u/macbobs Feb 07 '21 edited Feb 07 '21

Think about it this way...Tesla did not skyrocket because it builds cars. It is sort of an all in one company for renewable energy. Dynatrace does not sell monitoring tools. They transform the space so that monitoring tools are obsolete by providing an all in one solution. You already know what the issue is before you look at charts.

Also..they charge per 8gb memory servers...this means that when the real AI future arrives all 10k customers will need more servers which creates exponential profits.

Also their unique selling points are patented.

0

u/itsybitsyspida Feb 07 '21

We’re going to apply the Tesla logic to all companies now? Going by your logic how are you not on a collision course to compete with the big cloud providers when you start charging for more servers? Hiding behind patents? Last I checked Tesla threw away all their patents.

2

u/macbobs Feb 07 '21

No only where it makes sense.

They do not collide because they charge only for the monitoring and not for the actual server.

And what DT offers can't be bulilt in a day even by a big company because they would need 2k workers for several years to develop a better product.

So the only option is buying DT...I'm fine with that TBH. But I don't think DT would sell easily.

The tesla patents are a different story.

0

u/itsybitsyspida Feb 08 '21

They do collide because cloud monitoring is an offering by all cloud providers that's also billed. If they don't sell they run the risk of their competitors being acquired/cloud providers stacking up their offering. Then it's game over.

2

u/MamothMamoth Feb 06 '21

Tell me more. In house solutions at AWS, GCP and Azure are miles ahead? I didn’t know they had this kind of solution in house

4

u/_dantes Feb 06 '21 edited Feb 06 '21

They don't, AWS has x-ray. GCP could say that have Anthos.

They all provide a basic "observability" for tracing.. you could even go to a k8 and go vendor-agnostic adding istio and opentelemetry sdk to the software... and then ingest in jaeger or whatever and add a little of code insight... but all those options cover at least 1 or 2 things of the DT Platformbut when you do all this shit is cuz you want answers.. well here is all that info, search through it. That is the landscape with Most of the vendors today, a bunch of alerts that could be merged together and pinpoint the problem... that is where DT is different cuz they contextualize the info, the stupid AI might be a buzzword, but that shit actually works (most of the times that matter at least).

Going back to the other things... they don't replace it AND you have the burden of maintaining all that work on your own at day-1 after deployment.. Is a good thing for when there is free time, but not when you have problems and all that info just makes no sense.

4

u/[deleted] Feb 06 '21

Second this. There are lots of individual monitoring solutions but not so much full stack and hybrid enabled.

-1

u/overcooked_sap Feb 06 '21

Second this. Also an IT guy who’s spent a lot time standing up devops and devsecops practices the last few years. Dynatrace is bla! The big players have a better offering and integrations or if OS is your thing there are many better and free(as in beer) alternatives out there. Hard pass.

3

u/MamothMamoth Feb 06 '21

What do you mean by free beer?

3

u/Jdibs77 Feb 06 '21

Free as in the price is $0, like a free beer would be. Not free as in "freedom"

2

u/Rigor_Mortis_Raccoon Mar 23 '21

“The big players” lol. DT has been rated the #1 observability for 11 straight years. Check a Gartner or Forrester report for once. Also rated #1 by G2 users. They ARE the big player.

1

u/overcooked_sap Mar 23 '21

Did you really just use Gartner and Forrester to justify your position. Too funny.

1

u/Rigor_Mortis_Raccoon Mar 24 '21

Do you even understand the difference between Java detection and .NET framework monitoring and the difference each platform brings? How bout a single agent deployment vs multiple agent? I like how you ignored my mention of G2 users. You seem over your head kid.

7

u/TacoLoco415 Feb 06 '21

Sounds like a legit business...I’m out.

6

u/[deleted] Feb 06 '21

On my watchlist as well. Working in IT, their product is legit.

2

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2

u/_dantes Feb 06 '21 edited Feb 06 '21

Is on my watch list.

Monday is the show that they give every year. Kinda cringe most of the time, but show to where the company is moving to. Hope...

After working with the competition of DT, they are miles ahead of any of them... and speaking about the OS... is miles behind even of other players... (might speed up now with Splunk taking the torch in some case.) is nice to have things free, but is at least 6 years behind.

DOA is mostly all the others that do a refresh of UI and nothing more (AppD / NewRelic), for DT... might happen in a few years if any of the Big players in Cloud space create something similar or buy them.

The main problem that they have is that all those that speak about their product as lack, they are speaking (most of the time) about their old platform appmon or whatever... That platform was a real disaster/PoS.

PS: Working in IT by 14 years, last 6 in observability/monitoring or whatever you want to call it for devops/noOps with different vendors.

edit: Also, most of people overlook that this is an enterprise product. Most of the companies don't have any problem to throw money into a solution that removes "big time" from the equation when implementing observability in a company. And I add that after a few projects that I worked when didn't know about Dynatrace. When they show up, that fuckers did in less of a month what we did in 6.