On August 13, 2021, Cisco’s general manager of applications, Liz Centoni, announced the intention to acquire Epsagon into its strategy, incubation, and applications group. Epsagon is a private company founded in 2018 that specializes in full-stack application performance monitoring (APM). 

According to a Globes article, Cisco will acquire Epsagon for $500 million. This is another huge acquisition deal for Cisco after its acquisition of AppDynamics for $3.7 billion in 2017. AppDynamics, like Epsagon, also specializes in full-stack APM, so why does Cisco feel the need to acquire Epsagon?

Cloud applications enter the picture

The answer lies in cloud application performance monitoring. 

Traditional APM software was founded decades ago to monitor simple on-premises applications. This kind of software has a simple structure that only operates under one environment and is easy to monitor. But all this changed when companies began to build cloud applications and microservices. 

Microservices are very complex to monitor because they consist of individual sections of an app that run on hundreds of containers within servers interacting across multiple environments. They have become widely popular over the last couple of years, as one O’Reilly report found that 77% of their IT survey respondents have adopted microservices. 

Traditional APM software struggle with cloud applications

Traditional APM software has a hard time tracking microservices because of their sophistication. Therefore, many traditional APM companies aim to redevelop their on-premises APM software to fit on the cloud platform. This is very difficult because repurposed software takes a lot of time to recode and doesn’t fully monitor cloud apps. They are also harder to deploy since they aren’t cloud-native from the start. 

Unlike traditional APM solutions, Epsagon is an APM solution that is built for cloud applications. This includes microservices monitoring, full transaction tracing (traditional APM software only takes a sample of all the transactions), and so on. This is a great one-stop solution for any business that wants to ensure its full-stack application uptime.

What does G2 data say?

G2’s return on investment (ROI) data shows that Epsagon’s estimated ROI is four months, far ahead of its competitors, which includes AppDynamics. 

This highlights that Epsagon is profitable and delivers fast value for its customers. Cisco’s move to acquire Epsagon will enhance its full-stack APM capabilities, but with an increased focus on cloud applications.