New Relic has released its 2026 Observability Forecast: Asia-Pacific report, finding Australia and New Zealand organisations report comparatively stable IT operations but face a gap between detecting and resolving high-impact outages as AI-generated code increases complexity.
The report says Australia and New Zealand lead Asia-Pacific in operational discipline, with 18% of respondents reporting downtime costs under US$1 million an hour. Engineering teams in the region spend a median of 23% of their time addressing disruptions, compared with 30% globally and 50% in India, according to the survey.
New Relic also reported lower outage frequency in Australia and New Zealand, with 39% of organisations experiencing a high-impact outage once a month or less. The report says organisations in the region run a median of four observability tools, compared with a regional median of six.
AI adoption was cited as a growing driver of observability demand. The report found 42% of Australia and New Zealand respondents selected adoption of AI applications as a primary driver of observability demand, up from 32% last year. It also reported the use of AI coding assistants, with 47% of organisations using GitHub Copilot and 37% using OpenAI Codex. Half of respondents (50%) agreed that the rise of AI-generated code makes robust observability critical, the report said.
Despite reported operational stability, the report identified a “detection to resolution” gap in the region. It found 36% of respondents detected high-impact outages in under 30 minutes, with a mean time to detect of 29 minutes compared with a 35-minute global average. However, only 17% said they could resolve those same outages in under 30 minutes, which the report described as the widest resolution lag in Asia-Pacific.
The report linked slower resolution to data and tooling fragmentation. It found 41% of Australia and New Zealand organisations have unified telemetry into a single platform, compared with 55% globally. It also reported 32% have deployed distributed tracing (38% globally) and 24% use Kubernetes monitoring.
Cost pressures were also highlighted. New Relic reported cost has become the most important observability buying criterion for 41% of Australia and New Zealand respondents, up from 18% in 2024. Respondents cited lack of budget (28%) and complex tech stacks (32%) as major barriers to achieving full-stack observability. Nearly half (49%) said they were prioritising training staff on existing tools.
“Australia and New Zealand lead the Asia-Pacific region in operational discipline and running exceptionally lean software environments,” said New Relic Senior Vice President and General Manager for APJ Rob Newell. “However, a cautious approach to technology investment means that teams are struggling to see into the critical layers of their digital stacks. To overcome this risk-averse mindset and prepare for the complexities of AI-generated code and agentic AI, leaders should transition from a defensive posture of cost containment to a proactive strategy of platform consolidation.”
New Relic said it partnered with Enterprise Technology Research (ETR) to survey 2,575 IT and engineering leaders and practitioners in 24 countries and 12 industries. The survey included 150 respondents from Australia and New Zealand and was conducted in April and May 2026.
You can read the full report here.
