Datadog $2500/month Migration Options Analysis

Comprehensive 5-option analysis for a startup spending $2500/month on Datadog with 100GB daily logs, including optimization, Grafana Cloud, New Relic, SigNoz, and self-hosted paths.

Input

What you provide to the skill

Currently $2500/month on Datadog. Open to switching platforms if it saves significantly. What are our options for a startup with 5 services and 100GB daily logs?

Output

What the skill generates for you

Observability Cost Optimization: $2,500/month Datadog with 100GB Daily Logs

Current Situation Analysis

Current platform: Datadog
Monthly cost: $2,500
Log volume: 100GB/day = ~3,000GB/month (3TB)
Scale: 5 services
Team type: Startup (cost-sensitive, needs flexibility)

Estimated Cost Breakdown

Component	Est. Monthly Cost	% of Total	Notes
Log ingestion (3TB @ $0.10/GB)	$300	12%	Just ingestion before indexing
Log indexing (3TB indexed)	$1,500	60%	~$0.50/GB blended indexing rate
APM (5 hosts @ $31-40/host)	$200	8%	Application performance monitoring
Infrastructure monitoring (5-10 hosts @ $15/host)	$100	4%	Basic host monitoring
Custom metrics	$200	8%	High-cardinality metrics
Traces/other	$200	8%	Remaining features
TOTAL	$2,500	100%

Critical finding: You’re processing 100GB of logs per day (3TB/month), which is extremely high for a 5-service startup. This is your primary cost driver.

Option 1: Optimize Datadog (Stay on Platform)

Target: Reduce costs by 50-70% → $750-1,250/month
Effort: 1-2 weeks
Risk: Low (no migration)

Key Optimization Tactics

1. Exclusion Filters (60-80% volume reduction)

# Filter 1: Drop debug/trace logs
Filter: @level:debug OR @level:trace OR @level:verbose
Action: Exclude from indexes
Estimated reduction: 30-40GB/day

# Filter 2: Drop health check spam
Filter: @http.url_details.path:/health* OR @http.url_details.path:/ping
Action: Exclude from indexes
Estimated reduction: 10-15GB/day

# Filter 3: Sample successful requests (keep only 5-10%)
Filter: @http.status_code:[200 TO 299] AND @duration:<1000
Action: Sample to 5%
Estimated reduction: 30-40GB/day

Total after filters: 100GB/day → 10-30GB/day (70-90% reduction)
Estimated monthly savings: $1,200-1,650

Datadog Optimization Summary

Phase	Current	After	Savings
After filters	$2,500	$850-1,300	$1,200-1,650
After log levels	$850-1,300	$550-850	$300-450
After APM + metrics	$550-850	$275-525	$275-325
TOTAL OPTIMIZED	$2,500	$275-525	$1,975-2,225

Annual savings: $23,700-26,700 (79-89% reduction)

Option 2: Migrate to Grafana Cloud Free Tier

Target: $0-154/month (vs. $2,500)
Effort: 2-3 weeks
Risk: Medium (data migration, learning curve)

Grafana Cloud Pricing for Filtered Logs

Usage Level	Monthly Cost	Plan
Aggressive filtering to 1.5GB/day	$0	Free tier
Moderate filtering to 5GB/day	$79	Pro tier + 100GB overage
Light filtering to 10GB/day	$154	Pro tier + 250GB overage

Free Tier ($0/month) includes:

50GB logs/month (1.67GB/day) - FREE
50GB traces/month - FREE
10,000 active metric series - FREE
3 users - FREE
14-day retention

12-Month Cost Comparison

Scenario	Datadog Optimized	Grafana Cloud	Annual Savings
Aggressive filtering (1.5GB/day)	$275/mo = $3,300/yr	$0/yr	$3,300
Moderate filtering (5GB/day)	$525/mo = $6,300/yr	$79/mo = $948/yr	$5,352

Option 3: Migrate to New Relic Free Tier

Target: $0-80/month (vs. $2,500)
Effort: 2-3 weeks
Risk: Medium (user-based pricing can scale up)

New Relic Free Tier

Includes:

100GB data ingest/month - FREE
1 full-platform user - FREE
Unlimited basic users (read-only access)

Filtering Level	Daily Volume	Monthly Volume	New Relic Cost
Aggressive (97% reduction)	3GB/day	90GB/month	$0 (free tier)
Heavy (90% reduction)	10GB/day	300GB/month	$80/mo

Option 4: Migrate to SigNoz Cloud

Target: $49-150/month (vs. $2,500)
Effort: 2-3 weeks
Risk: Medium (newer platform, smaller community)

SigNoz Pricing

Base Plan: $49/month includes:

163GB logs + traces (5.4GB/day)
490M metric samples/month
Unlimited users
30-day retention

Filtering Level	Monthly Volume	SigNoz Cost
95% reduction	150GB/month	$49
90% reduction	300GB/month	$118/mo

Recommendation Matrix

Your Priority	Best Option	Est. Monthly Cost	Annual Savings	Effort
Stay on Datadog, minimize disruption	Optimize Datadog	$275-525	$23,700-26,700	12-17 hrs
Maximum savings, willing to migrate	Grafana Cloud Free	$0-154	$28,300-30,000	2-3 weeks
Easy migration, generous free tier	New Relic	$0-80	$28,800-30,000	2-3 weeks
OpenTelemetry future, startup-friendly	SigNoz	$49-268	$26,900-29,400	2-3 weeks

Recommended Path for Your Situation

Phase 1: Immediate (Week 1)

Optimize Datadog logs → Save $1,200-1,650/month

Add exclusion filters (4-6 hours work)
This alone drops you to $850-1,300/month
Zero risk, immediate savings

Phase 2: Short-term (Weeks 2-4)

Evaluate migration options in parallel

Test both:

Grafana Cloud (best free tier, OpenTelemetry)
New Relic (easiest migration, 100GB free)

Phase 3: Migration (Month 2)

Migrate to winner based on team preference and feature parity.

My recommendation: Grafana Cloud

Why: Best free tier (50GB), unlimited users, OpenTelemetry-native, no vendor lock-in
Cost: $0-154/month depending on filtering (vs. $2,500 current)
Annual savings: $28,152-30,000

12-Month Cost Projections

Scenario 2: Migrate to Grafana Cloud (Recommended)

Month	Monthly Cost	Notes
Month 1	$850	Datadog while testing Grafana
Month 2	$425	Dual-running both platforms
Month 3-12	$79	Grafana Pro + 100GB overage
Year 1 Total	$2,065	vs. $30,000 baseline
Savings	$27,935	93% reduction