New Relic simplifies portfolio under New Relic One as well as pricing in expansion play

The revamped New Relic approach aims to be one source of truth for telemetry data across a technology stack without sampling.
Written by Larry Dignan, Contributor

New Relic is planning on driving the convergence of logs, infrastructure, and application performance management (APM) and grow its market via a new pricing structure.

The company is updating its New Relic One platform with simplified pricing, interface, portfolio, and a free tier for engineers to try and use the software, which instruments IT environments and applications. CEO Lew Cirne said the move is designed to make New Relic easier to consume and address the convergence of logs, infrastructure, and APM. Simplified pricing from 11 paid products down to three, moving to per-user pricing and a perpetual free license will make doing business with New Relic easier, he said.

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"The context is that our customers now are struggling. The people that keep applications up and running are under a lot of stress and unanticipated surprises. Applications are more complex, but there's also an explosion of tooling," said Cirne.

Everything will be available on Thursday with all customers in the new integrated UI, three products that comprise the platform, including perpetual free tier available. New Relic said expects to transition existing customers at their renewal.   

What New Relic is really going for is a standardization play as developers have more than 30 tools just to gather telemetry. Companies like Splunk have been eyeing convergence with the acquisitions of SignalFx and Omnition, but Cirne argues that billing and UI across products need to converge, too. 

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New Relic One is what the company calls an observability platform so engineers can improve the usability of software as well as the impact on resources. The revamped version aims to be one source of truth for telemetry data across a technology stack without sampling.

New Relic One updates will include three primary products that all use the same database and query language:

  • The Telemetry Data Platform collects, visualizes, and provides alerts on application and infrastructure operational data. Cirne said the Telemetry Data Platform is delivered as a service and provides millisecond query speeds at economics that allow customers to instrument everything. "We'll be 90% cheaper than commercial log offerings," said Cirne.
  • Full-Stack Observability to analyze and troubleshoot a software stack across applications, infrastructure, logs, and digital customer experiences. "This represents the combination of all our products that focus on troubleshooting and Full-Stack Observability embraces open source," said Cirne.
  • Applied intelligence to detect, understand, and resolve incidents with a focus on preventing outages before they happen.

As for the pricing plans, New Relic One will have a perpetual free tier that includes 100GB of data for the Telemetry Data Platform for free each month; one free full access user license for Full-Stack Observability; 100 million app transactions for free each month for Applied Intelligence's Proactive Detection; and the first 1,000 incident events per month free for Applied Intelligence's Incident Intelligence.

After those free tiers are passed, the Telemetry Data Platform is priced at $0.25 per gigabyte of ingest, with Full-Stack Observability priced at a per-seat license and Applied Intelligence priced per transaction or event.

It's unclear how the pricing changes and free tiers will affect New Relic growth in the near future. New Relic delivered revenue of $599.5 million in revenue for fiscal 2020 ending March 31 and is estimated to report sales of $669.3 million for fiscal 2021.

Cirne said the transition for New Relic's approach rhymes with the shift from licensing to as-a-service for other software companies but will result in more growth and wallet share for the company.

"The primary competitor we have today is uninstrumented applications and in production," said Cirne. "Our industry has had free trials but not free tiers. This is what customers need because they haven't been able to monitor everything due to pricing, data silos, and technical feasibility."

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