ESTC vs DDOG: Who Wins???

I really didn’t want to write this but I felt I should.

Thanks to everyone who took the time to read my brief write-up on DDOG for some context.

When it comes to comparing ESTC and DDOG, the questions that the members of this board bring up on both sides are really worthwhile and made me introspect on my 10% investment in DDOG.

Here’s my perspective:

What is ESTC: Elastic NV is a company that was founded to provide commercial services and products around Elasticsearch. Elasticsearch is a search engine based on the Lucene ( an open-source library).

What is DDOG: Datadog is a monitoring service for cloud-scale applications, providing monitoring of servers, databases, tools, and services, through a SaaS-based data analytics platform.
[Keep in mind the word “Monitoring”]

Brief History of how ESTC saw DDOG then:
DataDog started as a company in 2010 focusing on cloud infrastructure monitoring. They initially used Postgres and as their needs grew they adopted Elasticsearch.

Here’s the link where ESTC proudly acknowledges DDOG:….

Here’s ESTC again cheering for DDOG in 2013 when it was a startup.

“Datadog is a SaaS monitoring service startup for IT, operations and development teams that enables these teams to better analyze metrics and events, ensuring their operations continue smoothly. By using Elasticsearch, Datadog was able to scale to take on larger customers who produce 500x more events than Datadog could originally handle.”…

What has happened since then?

Datadog kept focusing on what they started with - Cloud infrastructure “monitoring”. That single focus helped them go 10x ahead and monetize the APM market with their SAAS offering.

DDOG monitoring ESTC:
You may not be aware of this and is a little funny but true :). The monitoring capability of Datadog was good enough by then that they had a solution to monitor Elasticsearch ( which had problems including problems with determining the optimum heap size and others…( remember Elasticsearch is based on Java and has to deal with the Garbage Collection issues… i’m not going to delve into those technical details as they aren’t necessary for this discussion.).

If you need details please read this:…

ESTC Cloud Offering:
ESTC has surely realized how lucrative the monitoring space is and has a cloud offering now.

I’ll leave it to customers to compare and evaluate the costs and benefits versus the Datadog offerings.



My Takeaway: Being a developer myself, I have very high respect for Shay Banon and Elasticsearch. However, Datadog focused on a single area all these years…“Application Performance Monitoring”. Tinker, muji and others have written about this singular focus of DDOG in previous posts. In today’s context, AFAIK, both compaines have about the same number of FTEs. Do you think it is feasible that ESTC would ask all their FTEs to drop whatever they’re working on and focus on beating DDOG in what Datadog has accomplished in the last 10 years with a single focus?

Wrapping Up:
Here’s an example of a user who started off building a self-managed Elasticsearch cluster with engineers building visualizations and dashboards with Kibana. They then build automation to manage their Elasticsearch data. With the rise of bitcoin this company saw huge traffic and adopted Datadog. That company is none other than coinbase.…



P.S. Please note my Caveat about DDOG in my last post. I maintain my 10% position in DDOG which will change if the truth changes.


When it comes to comparing ESTC and DDOG, the questions that the members of this board bring up on both sides are really worthwhile and made me introspect on my 10% investment in DDOG. Here’s my perspective:

Thanks so much ron. We are so lucky on this board to have people like you who are able to explain these situations to us in a way that is simple and clear and understandable, even for the majority of us who are non techies. Thanks so much.




I greatly appreciate your technological expertise and perspectives on these companies. I am a non-techie myself but investing in a lot of tech these days. I gather that you have great confidence in DDOG with your 10% position and its dominance in Application Performance Monitoring (APM). As for ESTC, it’s apparently entering this area and you seem to also have great respect for its technology. Although it isn’t likely to win head to head against DDOG in APM, do you think it’s still likely a winner as well in its areas of expertise? A previous post suggested that Microsoft and others might have “surpassed” ESTC in search. From what I have read previously, ESTC’s search technology is top notch without any real peer and its technology has great optionality leading to numerous growth opportunities going forward. Do you share this view?




Thanks for your post. You said Datadog focused on a single area all these years…"Application Performance Monitoring
Are you sure? It appears they got into this space in 2017

Maybe you meant they were in Infrastructure monitoring since 2010 and going into APM in 2017 was not such a big jump.

ESTC has been in logging since 2010 (one of the best logging tools per Shay) and got into APM in 2017 as well. My understanding as a non-techie is logging is essential for monitoring since you monitor the data inside logs. This link says there is some benefit for 1 tool to do both logging and monitoring and that seems to the idea behind ESTC getting into monitoring - single stack observability etc.

Is your point that jumping from logging to APM is much harder than jumping from infra monitoring to APM?

Also don’t forget Oliver Pomel, DDOG’s CEO in the CC said logging is fast growing and less friction than APM. This statement has me confused. I thought DDOG was using their APM tools and using ESTC for logging. So, if that is correct should’nt ESTC grow as well simply because of logging?


The coinbase blog is interesting for a number of reasons.

For Coinbase, Elasticsearch is mission critical to their system.

They started with running their own clusters with X-pack for security and authentication for their engineer users.

Datadog is kind of a side story for that blog. Not that important other than to maintain visibility into the Elastic cluster while they wer l

They wound up using a managed Elasticsearch with AWS. Fretted about doing that with AWS because they lacked the features of X-pack. Did a work around by creating multiple shards for user groups(no security features for users).

So it would appear when this happened, Elastic lost an x-pack customer and AWS gained a hosted customer.

Which is why Elastic has spent a great deal of money and effort on SaaS. And SaaS is growing at 114% for Elastic.



Please don’t read my post as being dismissive of ESTC. ESTC is a great company with a great product stack and a lot of folks (including me having used Elasticsearch and Kibana in the past) like what they do. As data and services grow, the monitoring space surely won’t belong to one company ( no matter how good). So, ESTC will do well and who knows it may be a better investment than DDOG in the future. However, at the present Datadog is executing very well and their customers seem to like that.

In an earlier post, I mentioned how the Datadog API allows devs to build features on top of what Datadog already offers.

Here’s a great example from Coinbase in one of their blogs…

“Coinbase Watchdog is a GitHub app and a Golang service that uses the Datadog API to watch for changes in Datadog, achieving the best of both a code and UI-driven approach.”

[NOTE: Read this only if you’re technically inclined else skip it.… ]

Customers become raving fans only for a reason. For Datadog, I see that reason as enabling their customers to achieve their goals in an easy way that results in quick ROI!

Instead of writing more, here are three very short videos that will explain some of my thoughts much better (please watch them). The first video is more interesting in that the customer is located in the Netherlands which is home to ESTCs HQ.

For me, the most important thing going forward is to keep an eye on how DDOG innovates, executes and support their customers. Else, this is perhaps the third time I repeat that: monitoring is not necessarily sticky and it would not be difficult at all to replace Datadog if a better option comes along. Which could be ESTC, who knows. For now my wager is on DDOG.



P.S. Texmex, thanks for correcting me. Yes you’re right, I meant monitoring in general.