Datadog is an excellent product with a billing model that punishes success. Per-host pricing, per-GB log ingest, separately metered modules (APM, RUM, synthetics), and surcharges for custom metrics and high cardinality mean the bill grows with every host you add and every team that instruments something new. Bill shock at renewal is one of the most commonly cited reasons teams start looking, and the good news is that the open-source observability stack is now genuinely capable of replacing it. The risk is rebuilding the same cost structure in a different tool, so the choice of target matters.
Know what you are actually replacing
Datadog is three products in a trench coat: metrics, logs, and traces, plus dashboards and alerting over all three. Inventory which of those you actually rely on before you migrate. Many teams find they use Datadog heavily for metrics and dashboards but only lightly for logs, which changes the target calculus significantly.
Prometheus vs Grafana as the anchor
Prometheus is the right anchor when metrics are your center of gravity. It is the CNCF-standard, pull-based metrics engine, pairs with Alertmanager for alerting, and is typically visualized through Grafana. You self-host it, so you trade a subscription for running (and scaling) the storage yourself, with options like Thanos or Mimir for long-term retention. Choose it when you want a focused, metrics-first stack and have Kubernetes or exporter-friendly infrastructure.
Grafana (as the platform, with Mimir for metrics, Loki for logs, and Tempo for traces) is the right anchor when you want a single pane across all three signals, closer to Datadog’s breadth. Instrument with OpenTelemetry, keep Grafana OSS self-hosted or use Grafana Cloud’s tiers, and you get a unified experience without per-host penalties. It is more moving parts to run than Prometheus alone, but it maps more directly onto everything Datadog did for you.
Whichever you choose, the migration pattern is the same: deploy the new agents or OpenTelemetry collectors, rebuild dashboards and translate alerts, and dual-run both stacks until you trust the new one. Each path below opens to a full cost model, plan, and in-depth guide.