Faster IT could have buyers chasing performance testing deals

The pressure on IT departments to move faster could continue to stimulate M&A in the performance testing sector. IT teams are increasingly embracing DevOps practices to shorten development cycles, stay competitive and meet customer needs. We've observed, however, a corresponding decline in software reliability – in some cases, because teams opt not to properly test new software developments in their quest for speedy releases. And that could lead to acquirer interest in performance testing vendors that make it easier to do continuous testing and for development teams to test their products early in the process.

The top goal that IT decision-makers cited for their IT environments in the next year is to respond faster to business needs, according to our Voice of the Enterprise: Cloud Transformation, Workloads and Key Projects 2017 survey. In that study, more than one-third of all respondents told us that moving faster was their top goal for the coming year, ahead of cutting costs, which garnered fewer than one-quarter of responses.

The trend has already led to three performance testing deals since September 2016, when CA picked up BlazeMeter. Akamai's reach for SOASTA and Tricentis' buy were the other two, more recent, acquisitions. One final development that we believe is influencing the performance testing market is the merger that saw HPE's LoadRunner become part of MicroFocus. LoadRunner once dominated the performance testing landscape, and although its share has been eroded by newer entrants, it is still entrenched in many organizations that have invested heavily in using the tool. MicroFocus' acquisition of HPE's software business, however, casts uncertainty around the future of LoadRunner.

With those developments pressing on the performance testing market, we anticipate that both new and legacy application performance monitoring providers will explore purchases in this space. Subscribers to 451 Research's Market Insight Service can click here to access a detailed report on performance testing M&A activity.

For more real-time information on tech M&A, follow us on Twitter @451TechMnA.

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