Is Splunk Cloud a Cop-Out?

Splunk competitor Loggly claims Splunk’s new cloud offering is an admission that the company is giving up on software as a service.

Splunk recently announced Splunk Cloud, a new service that delivers Splunk Enterprise in the cloud. However, at least one competitor is asking whether Splunk Cloud is a cop-out.

In a blog post, Charlie Oppenheimer, CEO of Spunk competitor Loggly, claims that Splunk has given up on software as a service (SaaS).

“It appears that Splunk has thrown in the towel on software as a service (SaaS) and replaced Splunk Storm with a hosted software model,” Oppenheimer said in his post. “We were always skeptical that a company with such a phenomenally successful enterprise software business would disrupt its own business with a serious SaaS offering. And with today’s announcement of Splunk Cloud now it seems that the doubts were justified.”

Splunk officials declined to comment on Oppenheimer’s claims.

Splunk Storm is a cloud-based service that turns machine data into valuable insights, Splunk officials said. Machine data is generated by Websites, applications, servers, networks, mobile devices, and more. Splunk Storm consumes machine data and allows users to search and visualize it to monitor and analyze everything from customer clickstreams and transactions to network activity to call records.

“Splunk Storm always seemed half-hearted with many features from the popular Splunk software product missing and marketing of the product always seeming to be at half-mast, Oppenheimer said. “We heard reports that Splunk sales execs would often steer customers away from Storm for reasons including issues with scale. And Storm was introduced so close to their IPO that you had to wonder if a part of its role was to mollify analysts who urged them to make a SaaS offering to defend their flank from companies like Loggly and others.”

Splunk Cloud is powered by Amazon Web Services (AWS), and includes access to all the features of the Splunk Enterprise platform including apps, APIs, alerting and role-based access controls.

“In general I viewed Splunk’s cloud strategy as an evolutionary step,” Tony Baer, principal analyst with Ovum told eWEEK. “Put your toes in the water to see what works and what capabilities will be in demand rather than mount a Big Bang approach.”

Splunk Cloud also supports all core Splunk Enterprise use cases including application management, digital intelligence, IT operations management, security and more. And Splunk Cloud integrates with on-premise deployments of Splunk to deliver visibility into operational status, KPIs and security postures across all environments.

“Charlie's half right,” said Dennis Callaghan, an analyst with 451 Research. “It's a tacit admission by Splunk that Storm isn't really competitive with the new breed of log management SaaS guys like Loggly, SumoLogic, Logentries, etc. They’ve got some work to do with Splunk Cloud, including on the pricing model, but I do expect it to be a formidable offering in the still very nascent log management SaaS space. I'd be careful to sell Splunk short, they're still the team to beat in this space. And there's still a lot of opportunity out there.”

Andrew Brust, CEO of Blue Badge Insights, told eWEEK Loggly is all about log analysis as a service, with easy provisioning and elasticity, and they aim at the DevOps market. However, Splunk’s value proposition is different, he said.

Splunk 6 is, to me, all about self-serve analytics on what very often just happens to be machine data,” Brust said. “Apparently, Splunk’s new high-performance analytics store mixes columnar technology with indexed raw/unstructured data storage which sounded rather unique to me, and would be something that is applicable in numerous scenarios, not just log analysis. I think that’s one reason Splunk may be resonating better on premise than in the cloud–it’s applicable to lots of on-prem data.

“The two companies do compete, and if I were Loggly, I’d make some hay out of this too, because it enables them to articulate their own differentiation. But that differentiation actually underlies the point that the two companies’ offerings are very different, even if their markets overlap.”