Splunk obtains Palo Alto startup to catch greater cut of $12 billion observing business sector

Splunk obtains Palo
Splunk obtains Palo

Splunk obtains Palo is looking to make a bigger splash in the $12 billion online monitoring market with its acquisition of Flowmill, the company said Tuesday.

Flowmill, a Palo Alto-based network performance monitoring startup, marks the fifth acquisition Splunk has made in the past two years to grow its presence in the multibillion dollar cloud monitoring market, or observability market. Terms were not disclosed.

Cloud monitoring refers to the managing, monitoring and evaluation of cloud-based operations. That includes reviewing the availability and performance of websites, servers or applications. The technology allows customers to get a view into their network to troubleshoot issues, increase the performance of their networks or reduce its costs.

In September 2019, Splunk (NASDAQ: SPLK) made its largest acquisition to date when it snapped up SignalFX for $1.05 billion, kicking off its buying spree to build up its presence in the cloud observability market. That was followed shortly with the purchase of Omnition. This year the company has picked up Plumbr and Rigor to add to its M&A haul.

“We expect Splunk to accelerate growth in monitoring despite numerous competitors following its SignalFX, Omniscient, Plumbr, and Rigor acquisitions,” Michael Turits, an analyst with KeyBanc Capital Markets, said in an analyst report following Splunk’s October analyst day. He estimates Splunk is a leader in the monitoring industry with a 10% market share.

Splunk, a San Francisco-based platform company that collects data like logs, metrics and network data to index for easy searching, analysis, monitoring and reporting, has recently moved into the cloud observability market, adding to its presence in security analytics, operations monitoring and business intelligence.

“We expect it to compete aggressively in the cloud observability market post Covid-19,” Turits said in his report.

Flowmill, along with its previous four acquisitions, will be part of Splunk’s Observability Suite. The four-year-old company aims to provide a real-time view into the network behavior and performance of customers’ distributed cloud applications.

“Observability technology is rapidly increasing in both sophistication and ability to help organizations revolutionize how they monitor their infrastructure and applications,” Tim Tully, chief technology officer at Splunk, said in a statement.

The Flowmill acquisition is expected to close by late January.

Collect By: bizjournals.com


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