Cost Comparison: Micromegas vs. New Relic¶

Author: Gemini, a large language model from Google.

Disclaimer: This document presents a hypothetical, dollar-for-dollar cost comparison between a self-hosted Micromegas deployment and the New Relic SaaS platform. The following analysis is based on a series of significant assumptions about workload, pricing, and operational costs. These are estimates, not quotes. New Relic's pricing is based on data ingested and user seats. Actual costs will vary based on specific product usage, cloud provider, region, and negotiated enterprise agreements.

For a broader overview of observability cost models, see the Cost Modeling document.

Core Assumptions for this Comparison¶

Workload Definition (based on Micromegas Example Deployment):
- Total Events (over 90-day retention):
  - Logs: 9 billion log entries
  - Metrics: 275 billion metric data points
  - Traces: 165 billion trace events
- Monthly Ingestion Rate (for pricing comparison):
  - Logs: 3 billion log entries / month (9 billion / 3 months)
  - Metrics: ~92 billion metric data points / month (275 billion / 3 months)
  - Traces: 55 billion trace events / month (165 billion / 3 months)
- Retention: 90 days (3 months).
- Users: 5 Full Users (access to all data and features).
New Relic Pricing Assumption:
- New Relic's pricing is primarily based on data ingested (GB) and user seats.
- We will use publicly available pricing estimates for their standard plans as of mid-2025.
- Data Ingest Cost: We assume an average cost of ~$0.30 per GB of ingested data per month.
- User Seat Cost: We assume ~$99 per Full User per month.
- Assumption on New Relic Data Size: To enable a dollar-for-dollar comparison based on events, we must estimate the ingested GB for these events in New Relic. This is highly dependent on average event size and indexing/processing overhead.
  - Average log entry size for New Relic (after processing): 500 bytes
  - Average metric data point size for New Relic: 100 bytes
  - Average trace event size for New Relic: 1 KB
Micromegas TCO Assumption:
- The Total Cost of Ownership (TCO) for a self-hosted solution must include both direct infrastructure spend and the cost of personnel to manage the system.
- Infrastructure Costs: Based on the "Example Deployment" in the main README.md, the estimated monthly cloud spend for this workload (which results in ~8.5 TB of storage for Micromegas) is ~$1,000 / month.
- Operational Personnel Costs: We assume managing the self-hosted solution requires 20% of one full-time DevOps/SRE engineer's time. At a fully-loaded annual salary of $150,000, this equates to ~$2,500 / month.

The Challenge of Traces: Why Direct Comparison is Impractical¶

Micromegas is designed to ingest and store a very high volume of raw trace events (165 billion total, or 55 billion per month in our example) and process them on-demand. This is feasible due to its highly compact data representation and columnar storage, which keeps the underlying infrastructure costs manageable (~$500/month for 8.5 TB of total data, including traces).

Commercial SaaS tracing solutions like New Relic APM, Grafana Tempo, Datadog APM, or Elastic APM are typically priced based on ingested GB or spans, and their underlying architectures are optimized for real-time analysis and high-cardinality indexing. While powerful, this often comes at a significantly higher cost per GB or per span, especially for long retention periods.

For the 165 billion trace events (equivalent to 165 TB of raw data at 1KB/event) with 90-day retention, the estimated cost in a typical SaaS tracing solution would be prohibitively expensive (e.g., hundreds of thousands of dollars per month). This is why, in practice, high-volume tracing in SaaS solutions relies heavily on aggressive sampling.

SaaS Tracing Reality: To manage costs, users of SaaS tracing solutions often implement head-based or tail-based sampling, meaning only a small fraction (e.g., 1-10%) of traces are actually ingested and retained. This sacrifices data completeness for cost control.
Micromegas Tracing Philosophy: Micromegas is designed to ingest and retain a significantly larger volume of raw trace data compared to typical SaaS solutions. This allows for more comprehensive on-demand processing and analysis, providing a much more complete picture than heavily sampled approaches. This fundamental difference in approach makes a direct dollar-for-dollar comparison for traces misleading, as the two solutions are optimized for different cost/completeness trade-offs.

Analysis for Hypothetical Workload¶

1. Estimated Monthly Cost: Micromegas (Self-Hosted)¶

The estimated Total Cost of Ownership (TCO) for a self-hosted Micromegas instance is calculated by combining direct infrastructure costs with the cost of personnel required to manage the system.

Infrastructure Costs: ~$1,000 / month
- (Includes blob storage, compute, database, and load balancer based on the example deployment, handling the specified event volume with ~8.5 TB of storage)
Operational & Personnel Costs: ~$2,500 / month
- (Assumes 20% of a DevOps/SRE engineer's time)
Total Estimated Monthly Cost (TCO): ~$3,500 / month

2. Estimated Monthly Cost: New Relic (Logs & Metrics Only)¶

The New Relic cost is calculated by summing the costs for data ingested and user seats.

Calculated Ingested GB for New Relic (Logs & Metrics):
- Logs: 3 billion log entries/month * 500 bytes/entry = 1,500 GB/month
- Metrics: ~92 billion metric data points/month * 100 bytes/point = ~9,200 GB/month
- Total Ingested GB (Logs & Metrics): 1,500 + 9,200 = 10,700 GB/month
Data Ingest Cost:
- 10,700 GB/month * $0.30/GB
- Subtotal (Data Ingest): ~$3,210 / month
User Seats:
- 5 Full Users * ~$99/user/month
- Subtotal (Users): ~$495 / month
Operational & Personnel Costs:
- New Relic is a managed SaaS, but it still requires internal expertise to configure agents, build dashboards, and optimize queries. This cost is considered part of the subscription's value.
Total Estimated Monthly Cost (Logs & Metrics): ~$3,705 / month

Dollar-for-Dollar Comparison Summary¶

Category	Micromegas (Self-Hosted)	New Relic (SaaS)
Infrastructure Cost	~$1,000 / month	(Included in subscription)
Personnel / Ops Cost	~$2,500 / month	(Included in subscription)
Licensing / Subscription	$0	~$3,705 / month
Total Estimated Cost	~$3,500 / month	~$3,705 / month

Qualitative Differences¶

This comparison highlights the impact of data volume and user-based pricing on overall costs.

Total Cost of Ownership (TCO): For the same volume of events (excluding traces), the estimated TCO for Micromegas is lower than for New Relic. The primary driver is the cost of data ingestion in New Relic, which can become substantial for high volumes.
Platform Philosophy:
- New Relic (Integrated SaaS): New Relic offers a broad, integrated platform covering APM, infrastructure, logs, and more. It aims to provide a single pane of glass for observability, with a strong focus on application performance.
- Micromegas (Unified & Self-Hosted): Micromegas provides a unified data model for all telemetry types within your own cloud environment, offering greater control and cost efficiency for high-volume data.
Pricing Model: New Relic's pricing is a combination of data ingested and user seats. While data ingest is common, the per-user pricing can become a significant factor for larger teams. Micromegas's cost is directly tied to your cloud infrastructure spend.
Operational Burden: New Relic, as a SaaS, has a lower operational burden for managing the platform itself. However, configuring agents and optimizing data ingestion still requires internal effort.
Control & Data Ownership: Micromegas provides full data ownership and control within your own cloud account, which is a critical requirement for many organizations.
Cost at Extreme Scale: For very high data volumes, the cost of data ingestion in New Relic can become very high, potentially making a self-hosted solution like Micromegas more cost-effective. The user-based pricing also means costs scale with team size, regardless of data volume.