You don't need a contract to use Datadog, you can just sign up at their website. They give you a 14-day trial to test things out, and you can just pop in a credit card for any overages and incidentals. But you will pay significantly more with this model. If you have any kind of significant volume, it will be wiser to sign a contract. The cost difference on the public website varies by product, but for example, 15-day log retention goes from $2.55 to $1.70 (a 33% discount) when you sign a contract. What does significant mean? If you were going to spend over $30,000 a month on Datadog without a contract, I think it's worth discussing a contract.
I've seen half a dozen Datadog contracts, which isn't comprehensive, but a good enough selection, to provide some useful information. I will dive into more detail about these elsewhere if some of the terms do not make sense.
- Volume (Almost Always) Reduces Unit Cost - there are tiers, and when your usage breaks into a higher tier, your price per unit goes down. Don't be penny-wise and pound foolish here. Say, for example, the threshold for an additional 10% off on 15-day log ingestion is 100 million logs (I don't know the exact number). Don't commit to anything between 88 million and 99 million logs, just say 100 million, same price, more logs. One big thing that never(?) gets discounted is log ingest - I've never seen it under $0.10 / GB
- Drawdown Billing - after a certain amount, the contract will stop being product-based and move to dollar-based. This means that while you are using your product usage to guide your commit, the commit goes into one big bucket, and you can use more or less of a product as needed. The one caveat here is Audit Trail - once it's on, it's on, and turning it off does not return that money to the pool.
- Premier Support - some years ago, Datadog started baking in premier support to contracts. While you may have some negotiating room on the percentage, expect to pay for support. Based on the size of the contract, this may include a Technical Account Manager (TAM), Solution Architect (SA), and/or Account Manager (AM), but always includes instant chat support, as well as email and web support with fairly good SLAs.
- Product Bundling - some products, like Data Jobs Monitoring (DJM), APM/USM Hosts, Infrastructure Hosts will bundle in allotments of other products, and vary those based on the tier of product you select. For example, a Pro-tier Infrastructure Host includes 100 Custom Metrics for free, but an Enterprise Infrastructure Host includes 200. You have to look at your specific usage to understand what makes the most sense.
- Log Volume Measurement - log volume at Datadog is NOT measured in bytes for indexing, only ingestion. Long log lines at Datadog are truncated at 4 MB uncompressed. This means that if you emit lots of tiny log lines, you're going to pay more than if you constructed fewer but more information dense log messages. It also makes it hard to compare pricing between Datadog and other providers, most of which use bytes as the sole measure.
- 99th Percentile Billing - most costs that are billed as a monthly unit operate on 99th-percentile billing. Roughly speaking, this means that each hour, Datadog counts how many units you have of a particular product. At the end of the month, Datadog creates a numerically sorted list, and chops off the highest 7 values (720 hours in most months, 1% rounds to 7 hours), and bills for the 8th value. So you can have a truckload of instances and metrics for 7 hours a month (load testing anyone?) but that won't count if you shut it all down before the 8th hour.
- Multiyear Discounts - always ask about multi-year discounts. Like any provider, Datadog saves money if they can renegotiate contracts every two years instead of every year, and it provides them (and you) stability in revenue (and cost).