Snowflake Buys Observe to Supercharge Data Observability
In a strategic move that signals deeper integration of data and observability, Snowflake has announced its intent to acquire Observe—an observability platform purpose-built on Snowflake’s data cloud from day one. The deal, confirmed on January 8, 2026, aims to give enterprises a centralized, scalable way to monitor logs, metrics, and traces across their data and software infrastructure. As AI-driven systems flood organizations with unstructured telemetry data, Snowflake says the acquisition will let users detect and resolve issues up to 10 times faster than current methods allow.
Why Observability Matters More Than Ever
Observability—the ability to understand a system’s internal state based on its external outputs—has become mission-critical in the era of AI and real-time analytics. Modern applications generate massive volumes of telemetry data, and traditional monitoring tools simply can’t keep up. Observe addresses this by treating observability data as first-class analytics, using Snowflake’s scalable architecture to store, query, and analyze logs, metrics, and traces without requiring complex pipelines or siloed tooling. For companies managing AI agents, microservices, or hybrid cloud environments, this integration could dramatically reduce mean time to resolution (MTTR).
A Partnership Rooted in Shared DNA
The Observe acquisition isn’t a cold corporate merger—it’s the latest chapter in a long-standing relationship. Both Snowflake and Observe were incubated at Sutter Hill Ventures, the influential Silicon Valley firm known for betting early on foundational infrastructure plays. Snowflake’s founding CEO, Mike Speiser, was a managing director at Sutter Hill, and Observe’s leadership team includes Jeremy Burton, who’s served on Snowflake’s board since 2015. This alignment in vision and technical philosophy explains why Observe chose to build its entire platform on Snowflake back in 2018, long before this acquisition was on the table.
Built on Snowflake, Now Part of Snowflake
Observe’s architecture has always leaned into Snowflake’s strengths: separation of compute and storage, ANSI SQL compatibility, and near-infinite scalability. By designing its observability platform natively on Snowflake, Observe eliminated the need for separate data lakes or proprietary storage formats. Now, with full integration on the horizon, Snowflake customers will gain seamless access to Observe’s capabilities without migrating data or learning new query languages. This “zero-copy” integration aligns perfectly with Snowflake’s broader strategy of embedding intelligence directly into the data cloud.
Unified Telemetry with Open Standards
A key technical highlight of the deal is Observe’s foundation on open-source standards like Apache Iceberg and OpenTelemetry. Apache Iceberg enables high-performance table formats for massive datasets, while OpenTelemetry provides a vendor-neutral way to collect telemetry. By anchoring its platform in these ecosystems, Observe ensures customers aren’t locked into proprietary formats—a growing concern in the observability space. Snowflake’s embrace of these standards signals its commitment to interoperability, even as it consolidates more functionality under its own roof.
Speed, Scale, and Simplicity for Data Teams
According to Snowflake’s internal benchmarks, integrating Observe allows engineering and data teams to identify anomalies, debug pipelines, and correlate system behavior across services 10x faster. But the real win may be simplicity. Instead of juggling multiple dashboards, agents, and storage systems, users can now query all telemetry data using familiar SQL within Snowflake’s secure, governed environment. For data leaders already managing exploding costs and tool sprawl, this consolidation could translate to both operational efficiency and budget relief.
What This Means for Snowflake’s Product Roadmap
The acquisition accelerates Snowflake’s evolution from a data warehousing platform into a full-stack intelligence layer. In recent years, Snowflake has added AI/ML capabilities, native app development (Snowpark), and industry-specific data clouds. Observability is the missing piece for ensuring those advanced workloads run reliably. Expect Observe’s features—like automatic schema inference, dynamic dashboards, and anomaly detection—to be deeply woven into Snowpark, Snowflake Cortex, and even its AI Agent Framework in the coming quarters.
A Strategic Play Against Competing Clouds
While AWS, Microsoft Azure, and Google Cloud offer their own observability suites (CloudWatch, Azure Monitor, etc.), they often silo telemetry data away from analytics workloads. Snowflake’s approach flips that model: observability becomes just another analytical workload inside the data cloud. This could be especially appealing to multi-cloud or cloud-agnostic enterprises that want to avoid vendor lock-in while maintaining performance. By owning both the data plane and the observability layer, Snowflake strengthens its value proposition as a neutral, high-performance alternative to hyperscaler stacks.
Backed by Heavyweight Investors
Observe’s journey to acquisition was fueled by nearly $500 million in venture funding from Snowflake Ventures, Sutter Hill Ventures, and Madrona—underscoring strong institutional confidence in its vision. The fact that Snowflake Ventures was an early investor also hints at a long-gestating strategy: rather than build observability from scratch, Snowflake opted to acquire a mature, compatible solution that already shared its architectural DNA. That foresight may pay off quickly as enterprises demand tighter integration between data, AI, and operational intelligence.
What’s Next for Existing Observe Customers?
Current Observe users can expect a smooth transition, with Snowflake pledging continued support and enhanced features post-integration. Because Observe already runs on Snowflake, migration overhead should be minimal—no data movement, no new contracts, and no retraining on query syntax. In fact, existing customers may be among the first to benefit from tighter coupling with Snowflake’s AI and governance tools. The regulatory approval process is expected to conclude in mid-2026, with full product integration likely by year-end.
A Signal to the Data Industry
Snowflake’s acquisition of Observe sends a clear message: the future of data infrastructure isn’t just about storage and compute—it’s about visibility, trust, and resilience. As AI agents autonomously generate and act on data, the ability to observe, explain, and troubleshoot becomes non-negotiable. By bringing Observe in-house, Snowflake isn’t just adding a feature—it’s embedding observability into the core promise of its data cloud. In doing so, it sets a new benchmark for what modern data platforms must deliver.
The Snowflake-Observe merger represents more than a corporate acquisition—it’s a convergence of two philosophies: that data should be accessible, governed, and intelligible at scale. For enterprises drowning in telemetry but starving for insight, this integration could be a lifeline. As Snowflake rolls out the combined platform later this year, the data world will be watching closely to see if it delivers on its bold promise: turning observability from an operational chore into a strategic advantage.
