The third annual study is once again the largest, most comprehensive of its kind and the only study to open-source its raw data. This year’s report surveyed 1,700 technology professionals, including 1,100 practitioners — day-to-day users of observability tools — and 600 IT decision-makers across 15 countries, to understand the current state of observability, the areas with the most and least amount of growth, and the external forces influencing spending and adoption.
According to the research, respondents in Australia and New Zealand continue to struggle with tool sprawl. More than half (54%) were using five or more tools for observability, even though 20% said too many monitoring tools were a barrier to observing full-stack observability. This may change, as almost half (48%) planned to consolidate tools over the next year to get the most value from their observability spend.
The 2023 Observability Forecast report found:
• Observability adoption is high and increasing. About two in five (41%) in New Zealand and just over a third in Australia (35%) had achieved full-stack observability. However, just 18% said their telemetry was captured across the full tech stack, which is notably lower than the global average (24%).
• The biggest drivers for observability in ANZ are security, governance and risk (43%), multi-cloud migration (41%) and customer experience management (37%).
• Outages are expensive. 42% said critical business app outages cost their organisation $390,000 (US$250,000) or more per hour of downtime, which translates to a median annual outage cost of over $11 million (US$7.37 million) for Australia and $12.75 million (US$8.5 million) for New Zealand.
• Full-stack observability improves service-level metrics — 62% said their MTTR improved to some degree since adopting observability, including 26% who said it improved by 25% or more.
• 2x ROI on observability. Nearly a third (29%) of Australian C-level executives said their organisation receives a total annual value of $1.5 million (US$1 million) or more from their observability investment. Australian organisations realised a 2x return on their observability investment, while those in New Zealand broke even.
• Observability increases operational efficiency. Two out of five (42%) cited increased operational efficiency as a primary benefit, while over a third (36%) said observability improved system uptime and reliability as well as security vulnerability management (36%).
“While organisations in ANZ are seeing encouraging 2x returns on their observability investment, tool consolidation remains a key priority to achieving full-stack observability and minimising the impact of outages,” said New Relic APJ chief architect Peter Marelas. “The Observability Forecast shows that teams with full-stack observability consistently have fewer outages while detecting and resolving issues faster than those without it. This translates to lower outage costs, a higher annual return on investment, and a positive effect on an organisation’s bottom line. The business value of observability is clear.”
Trends driving observability
Observability remains a business imperative for forward-thinking enterprise leaders. By mid-2026, 82% or more of the global respondents expected to deploy each of the 17 different observability capabilities. Most organisations may have robust observability practices in place within three years, highlighting the industry’s growth potential.
Nearly half (49%) indicated an increased focus on security was driving the need for observability, followed by the integration of business apps into workflows and the adoption of AI technologies. The security focus reflects the rise of cybersecurity threats and complex cloud-native application architectures that introduce additional risk. For OpenTelemetry, scalability (52%) and the fact that it integrates with their existing tool stack (46%) were driving its adoption, indicating that OpenTelemetry is a movement vendors must embrace to meet customer demands.
The New Relic 2023 Observability Forecast is available today. For more information:
Read the full report.
Download the report infographic.
View the raw data.
Research methodology
New Relic and ETR surveyed 1,700 technology professionals in 15 countries across Asia Pacific, Europe, and North America. Of the respondents, 65% were practitioners (developers and engineers) and 35% were information technology decision-makers (C-suite executives and non-executive managers). The survey was conducted in March and April 2023 by the research firm ETR. The annual Observability Forecast is the only study of its kind to make its raw survey data open and available to the public for download.
About New Relic
As a leader in observability, New Relic empowers engineers with a data-driven approach to planning, building, deploying, and running great software. New Relic delivers the only unified data platform that empowers engineers to get all telemetry—metrics, events, logs, and traces—paired with powerful full stack analysis tools to help engineers do their best work with data, not opinions. Delivered through the industry’s first usage-based consumption pricing that’s intuitive and predictable, New Relic gives engineers more value for the money by helping improve planning cycle times, change failure rates, release frequency, and mean time to resolution. This helps the world’s leading brands including adidas Runtastic, American Red Cross, Australia Post, Banco Inter, Chegg, GoTo Group, Ryanair, Sainsbury’s, Signify Health, TopGolf, and World Fuel Services (WFS) improve uptime, reliability, and operational efficiency to deliver exceptional customer experiences that fuel innovation and growth. www.newrelic.com.
