Skip to main content

10 Key Takeaways from the 2023 Observability Forecast

Ishan Mukherjee
New Relic

Earlier this year, New Relic conducted a study on observability. The company surveyed 1,700 IT practitioners and decision-makers across 15 countries in North America, Europe and the Asia Pacific region to to understand the current state of the practice and the external forces influencing spending and adoption. The 2023 Observability Forecast reveals observability's impact on the lives of technical professionals and businesses' bottom lines.


Here are 10 key takeaways from the forecast:

1. Observability delivers 2x annual ROI

Respondents to the survey receive a median $2 of return per $1 of investment in observability, with 41% receiving more than $1 million total annual value. Almost all (96%) respondents expected a significant negative business outcome without observability — noting higher operation costs and revenue loss from downtime as the concrete financial impacts of not having observability.

2. Outages are expensive - observability is critical

32% of respondents said critical business app outages cost more than $500K per hour of downtime. Although respondents report a median annual outage cost of $7.75 million, those with full-stack observability experience a median outage cost 37% lower than those without full-stack observability.

3. Observability improves service-level metrics

Respondents with full-stack observability are more likely to experience the fastest mean time to resolution (MTTR) and were 19% more likely to resolve high-business-impact outages in 30 minutes or less compared to those without full-stack observability.

4. Observability adoption accelerating

While most organizations still don't monitor their full tech stack, this is changing. Full-stack observability increased 58% YoY. By mid-2026, at least 82% of respondents expected to deploy each of the 17 different observability capabilities.

5. Organizations want tool consolidation

Tool sprawl remains an obstacle for organizations of all sizes despite a 2-to-1 preference for a single, consolidated platform. However, the proportion using a single tool more than doubled year-over-year, and the average number of tools deployed has gone down by almost one tool.

6. Organizations still haven't fully unified telemetry data

Siloed and fragmented data make for a painful user experience. Among the 40% of respondents who had more siloed data, 68% indicated that they strongly prefer a single, consolidated platform. Respondents with more unified telemetry data were more likely to have fewer high-business-impact outages, a faster MTTD, and a faster MTTR than those with more siloed telemetry data.

7. Security is driving observability adoption

Modern applications typically run in the cloud and depend on hundreds of components, each introducing additional monitoring challenges and security risks. Nearly half (49%) said an increased focus on security, governance, risk, and compliance was driving the need for observability, making it the top choice two years in a row. The security focus reflects the rise of cybersecurity threats and complex cloud-native application architectures.

8. AI and apps are also important to organizations

About two in five (38%) said the integration of business apps into workflows and the adoption of artificial intelligence (AI) technologies was driving the need for observability. The focus on AI and business apps like enterprise resource planning (ERP) and customer relationship management (CRM) makes sense as organizations are competing to attract and retain customers by providing the best customer experience.

9. Clear business benefits of observability

Almost half (46%) of practitioners said observability increases their productivity so they can find and resolve issues faster. About a third (35%) of IT decision-makers said it helps them achieve technical key performance indicators (KPIs) and/or business KPIs (31%). Of the total respondents, two out of five (40%) said improved system uptime and reliability is a primary benefit — 13% more than last year — while 38% cited increased operational efficiency and 34% focused on security vulnerability management.

10. The increase in observability deployment is expected to continue

Most respondents (83%) expected to deploy at least one new capability in the next year, with more than half (51%) of respondents expected to deploy one to five, and nearly a third (32%) expected to deploy six or more. For 2024, at least 90% of organizations expect to deploy capabilities like network monitoring, database monitoring, security monitoring, and alerts. These findings indicate observability's strong growth potential in the near future.

Ishan Mukherjee is SVP of Growth at New Relic

Hot Topics

The Latest

As businesses increasingly rely on high-performance applications to deliver seamless user experiences, the demand for fast, reliable, and scalable data storage systems has never been greater. Redis — an open-source, in-memory data structure store — has emerged as a popular choice for use cases ranging from caching to real-time analytics. But with great performance comes the need for vigilant monitoring ...

Kubernetes was not initially designed with AI's vast resource variability in mind, and the rapid rise of AI has exposed Kubernetes limitations, particularly when it comes to cost and resource efficiency. Indeed, AI workloads differ from traditional applications in that they require a staggering amount and variety of compute resources, and their consumption is far less consistent than traditional workloads ... Considering the speed of AI innovation, teams cannot afford to be bogged down by these constant infrastructure concerns. A solution is needed ...

AI is the catalyst for significant investment in data teams as enterprises require higher-quality data to power their AI applications, according to the State of Analytics Engineering Report from dbt Labs ...

Misaligned architecture can lead to business consequences, with 93% of respondents reporting negative outcomes such as service disruptions, high operational costs and security challenges ...

A Gartner analyst recently suggested that GenAI tools could create 25% time savings for network operational teams. Where might these time savings come from? How are GenAI tools helping NetOps teams today, and what other tasks might they take on in the future as models continue improving? In general, these savings come from automating or streamlining manual NetOps tasks ...

IT and line-of-business teams are increasingly aligned in their efforts to close the data gap and drive greater collaboration to alleviate IT bottlenecks and offload growing demands on IT teams, according to The 2025 Automation Benchmark Report: Insights from IT Leaders on Enterprise Automation & the Future of AI-Driven Businesses from Jitterbit ...

A large majority (86%) of data management and AI decision makers cite protecting data privacy as a top concern, with 76% of respondents citing ROI on data privacy and AI initiatives across their organization, according to a new Harris Poll from Collibra ...

According to Gartner, Inc. the following six trends will shape the future of cloud over the next four years, ultimately resulting in new ways of working that are digital in nature and transformative in impact ...

2020 was the equivalent of a wedding with a top-shelf open bar. As businesses scrambled to adjust to remote work, digital transformation accelerated at breakneck speed. New software categories emerged overnight. Tech stacks ballooned with all sorts of SaaS apps solving ALL the problems — often with little oversight or long-term integration planning, and yes frequently a lot of duplicated functionality ... But now the music's faded. The lights are on. Everyone from the CIO to the CFO is checking the bill. Welcome to the Great SaaS Hangover ...

Regardless of OpenShift being a scalable and flexible software, it can be a pain to monitor since complete visibility into the underlying operations is not guaranteed ... To effectively monitor an OpenShift environment, IT administrators should focus on these five key elements and their associated metrics ...

10 Key Takeaways from the 2023 Observability Forecast

Ishan Mukherjee
New Relic

Earlier this year, New Relic conducted a study on observability. The company surveyed 1,700 IT practitioners and decision-makers across 15 countries in North America, Europe and the Asia Pacific region to to understand the current state of the practice and the external forces influencing spending and adoption. The 2023 Observability Forecast reveals observability's impact on the lives of technical professionals and businesses' bottom lines.


Here are 10 key takeaways from the forecast:

1. Observability delivers 2x annual ROI

Respondents to the survey receive a median $2 of return per $1 of investment in observability, with 41% receiving more than $1 million total annual value. Almost all (96%) respondents expected a significant negative business outcome without observability — noting higher operation costs and revenue loss from downtime as the concrete financial impacts of not having observability.

2. Outages are expensive - observability is critical

32% of respondents said critical business app outages cost more than $500K per hour of downtime. Although respondents report a median annual outage cost of $7.75 million, those with full-stack observability experience a median outage cost 37% lower than those without full-stack observability.

3. Observability improves service-level metrics

Respondents with full-stack observability are more likely to experience the fastest mean time to resolution (MTTR) and were 19% more likely to resolve high-business-impact outages in 30 minutes or less compared to those without full-stack observability.

4. Observability adoption accelerating

While most organizations still don't monitor their full tech stack, this is changing. Full-stack observability increased 58% YoY. By mid-2026, at least 82% of respondents expected to deploy each of the 17 different observability capabilities.

5. Organizations want tool consolidation

Tool sprawl remains an obstacle for organizations of all sizes despite a 2-to-1 preference for a single, consolidated platform. However, the proportion using a single tool more than doubled year-over-year, and the average number of tools deployed has gone down by almost one tool.

6. Organizations still haven't fully unified telemetry data

Siloed and fragmented data make for a painful user experience. Among the 40% of respondents who had more siloed data, 68% indicated that they strongly prefer a single, consolidated platform. Respondents with more unified telemetry data were more likely to have fewer high-business-impact outages, a faster MTTD, and a faster MTTR than those with more siloed telemetry data.

7. Security is driving observability adoption

Modern applications typically run in the cloud and depend on hundreds of components, each introducing additional monitoring challenges and security risks. Nearly half (49%) said an increased focus on security, governance, risk, and compliance was driving the need for observability, making it the top choice two years in a row. The security focus reflects the rise of cybersecurity threats and complex cloud-native application architectures.

8. AI and apps are also important to organizations

About two in five (38%) said the integration of business apps into workflows and the adoption of artificial intelligence (AI) technologies was driving the need for observability. The focus on AI and business apps like enterprise resource planning (ERP) and customer relationship management (CRM) makes sense as organizations are competing to attract and retain customers by providing the best customer experience.

9. Clear business benefits of observability

Almost half (46%) of practitioners said observability increases their productivity so they can find and resolve issues faster. About a third (35%) of IT decision-makers said it helps them achieve technical key performance indicators (KPIs) and/or business KPIs (31%). Of the total respondents, two out of five (40%) said improved system uptime and reliability is a primary benefit — 13% more than last year — while 38% cited increased operational efficiency and 34% focused on security vulnerability management.

10. The increase in observability deployment is expected to continue

Most respondents (83%) expected to deploy at least one new capability in the next year, with more than half (51%) of respondents expected to deploy one to five, and nearly a third (32%) expected to deploy six or more. For 2024, at least 90% of organizations expect to deploy capabilities like network monitoring, database monitoring, security monitoring, and alerts. These findings indicate observability's strong growth potential in the near future.

Ishan Mukherjee is SVP of Growth at New Relic

Hot Topics

The Latest

As businesses increasingly rely on high-performance applications to deliver seamless user experiences, the demand for fast, reliable, and scalable data storage systems has never been greater. Redis — an open-source, in-memory data structure store — has emerged as a popular choice for use cases ranging from caching to real-time analytics. But with great performance comes the need for vigilant monitoring ...

Kubernetes was not initially designed with AI's vast resource variability in mind, and the rapid rise of AI has exposed Kubernetes limitations, particularly when it comes to cost and resource efficiency. Indeed, AI workloads differ from traditional applications in that they require a staggering amount and variety of compute resources, and their consumption is far less consistent than traditional workloads ... Considering the speed of AI innovation, teams cannot afford to be bogged down by these constant infrastructure concerns. A solution is needed ...

AI is the catalyst for significant investment in data teams as enterprises require higher-quality data to power their AI applications, according to the State of Analytics Engineering Report from dbt Labs ...

Misaligned architecture can lead to business consequences, with 93% of respondents reporting negative outcomes such as service disruptions, high operational costs and security challenges ...

A Gartner analyst recently suggested that GenAI tools could create 25% time savings for network operational teams. Where might these time savings come from? How are GenAI tools helping NetOps teams today, and what other tasks might they take on in the future as models continue improving? In general, these savings come from automating or streamlining manual NetOps tasks ...

IT and line-of-business teams are increasingly aligned in their efforts to close the data gap and drive greater collaboration to alleviate IT bottlenecks and offload growing demands on IT teams, according to The 2025 Automation Benchmark Report: Insights from IT Leaders on Enterprise Automation & the Future of AI-Driven Businesses from Jitterbit ...

A large majority (86%) of data management and AI decision makers cite protecting data privacy as a top concern, with 76% of respondents citing ROI on data privacy and AI initiatives across their organization, according to a new Harris Poll from Collibra ...

According to Gartner, Inc. the following six trends will shape the future of cloud over the next four years, ultimately resulting in new ways of working that are digital in nature and transformative in impact ...

2020 was the equivalent of a wedding with a top-shelf open bar. As businesses scrambled to adjust to remote work, digital transformation accelerated at breakneck speed. New software categories emerged overnight. Tech stacks ballooned with all sorts of SaaS apps solving ALL the problems — often with little oversight or long-term integration planning, and yes frequently a lot of duplicated functionality ... But now the music's faded. The lights are on. Everyone from the CIO to the CFO is checking the bill. Welcome to the Great SaaS Hangover ...

Regardless of OpenShift being a scalable and flexible software, it can be a pain to monitor since complete visibility into the underlying operations is not guaranteed ... To effectively monitor an OpenShift environment, IT administrators should focus on these five key elements and their associated metrics ...