SmartBear Acquires AlertSite: The Lifecycle of Application Management with End-User Experience in Mind PDF Print
Written by Jeffrey Hill   
May 20, 2011

On April 4th, 2011, SmartBear Software enhanced its traditional focus on application testing and QA by acquiring AlertSite, a developer of application web performance monitoring and management tools. SmartBear's products emphasize the importance of managing the entire application lifecycle from code review to application profiling and automated testing for QA. By way of contrast, AlertSite is focused on synthetic monitoring and testing of web site performance. The product lines of both companies are complementary and together form a suite of applications that monitor and manage applications from inception to deployment and actual use.

This is a good move for SmartBear for several reasons. To begin, both companies have sizeable communities of users: SmartBear has a development and QA community of more than 100,000 users, while AlertSite's DejaClick has had more than 250,000 downloads, providing an opportunity to cross-sell and up-sell across both communities. While AlertSite's approach for monitoring Web performance has been resonating well with their customers, the company lacked resources to truly challenge companies that have been leaders in this space such as Gomez and Keynote Systems. Through this acquisition, AlertSite gains additional marketing muscle and research and development resources.

However, when you take a closer look into the product portfolios and strategies of these vendors, it becomes apparent that some of the key dynamics in the application management market are influencing this acquisition.

 --  The concept of a lifecycle of application performance management has been present in the market for some time and has been accepted mostly by vendors who provide solutions for application testing in pre-production. Vendors are becoming increasingly aware of the importance of providing solutions which identify how the lifecycle of application management affects both end-user experience and business goals.

          -- The continuing growth of cloud services, especially the emergence of hybrid clouds, is driving the need for application performance monitoring solutions that are agnostic about where applications are hosted. Companies are recognizing that the most effective strategy for the deployment of testing and monitoring solutions is to move monitoring points closer to the end-user. The fact that AlertSite's DejaClick solution is browser-based aligns well with this trend and its users have visibility into the quality of end-user experience, regardless of whether their applications are hosted in the cloud or in an on-premise managed datacenter
            -- The importance of this acquisition to the industry should not be overlooked, especially in the context of other recent events such as Compuware's 2009 acquisition of Gomez or Neustar's acquisition of Webmetrics in 2008. All of these acquisitions signal the growing importance of monitoring application performance and the end-user experience from outside of corporate firewall which is a very valuable capability for managing cloud environments. They also reinforce the need for bigger players in the market to either develop these capabilities in-house, which is a very time-consuming and costly proposition given how these solutions are deployed, or to acquire them in a market where the number of available companies is diminishing with somewhat alarming swiftness. For companies looking to spend some money to acquire this capability, Keynote and Catchpoint are among the few remaining targets.

            This acquisition gives SmartBear opportunities that go well beyond extending their current community and creating new channels for AlertSite's products. SmartBear now has an opportunity to capitalize on market trends that call for a more user-centric approach throughout the entire lifecycle of application management. Taking advantage of these trends will require tighter integration with AlertSite's product portfolio, as well as building product capabilities that enhance their appeal to companies that are adopting a DevOps methodology.

            Web performance has become critical to conducting business – nothing discourages customers or potential customers faster than poor website performance. However, TRAC's recent research shows that issues with the quality of end-user experience for websites occur 10 times more frequently than website outages. For that reason, organizations report losing twice as much revenue due to issues with end-user experience as they do for issues with site availability, proof that end-user experience should be at the core of application performance management initiatives. Including user experience in the entire lifecycle of application management should lead to better customer retention and increased revenue.

             

             
             

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