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The Cost of Downtime

12 May, 2015

data_centre_downWhile on the surface an IT system should be streamlined and speedy, it should ultimately be underpinned by a robust downtime management strategy. Why? Because at the end of the day, the cost of downtime can be disastrous. Yet despite this fact, CA Technologies has revealed that 56% of North American enterprises and 30% of European companies don't have a good disaster recovery plan in place. To help your business realise the risks we’ve put together a guide to the cost of downtime and why you should avoid it at all costs.

Calculating the costs

Data centres power a myriad of different applications and when systems fail the results are wide felt. From telecommunications providers and hospitality groups to defence contractors and financial institutions, every user feels the sting. While losses will vary from data centre to date centre, the Ponemon Institute estimates that the average cost of IT system downtime equates to an eye-watering US$7900 per minute. With average reported incident lengths measuring in at 90 minutes, the total cost per incident sits at approximately $711,000. In some cases, single events can cost millions.

As well as financial losses businesses experiencing downtime also receive a huge amount of negative publicity. Often downtime will have negative consequences for members of the public which can cause a fierce and irreparable backlash.

It happens to the best in the business

Thinking that your business is above data centre downtime is a serious faux pas. Even the most powerful players in the business can fall victim to system shutdowns, as demonstrated by the recent 2010 Virgin Blue online system outage. In September 2010 the check-in and online booking systems crashed intermittently for 11 days, affecting over 50,000 passengers and 400 flights. As well as drumming up a huge amount of negative press Virgin also lost millions. However it was airline outsourcing services and operations support group Navitaire, that ended up empty handed when it was forced to compensate Virgin Blue US$20 million. 

What’s the solution?

Whether operating as a small independent enterprise or a multinational corporation it’s critical to avoid downtime at all costs. The key is to have a reliable and robust system in place that minimises the risk of system failure and is capable of managing downtime in a worst case scenario. 

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