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[INFOGRAPHIC] The True Cost of Downtime: 21 Stats You Need to Know

The True Cost of Downtime: 21 Stats You Need to Know

If you work in IT, you’ve probably dealt with downtime—and all of the challenges that come along with it. While outages happen to all organizations, the cost of downtime can vary depending on a number of factors, one of which is how quickly you can recover. And cloud-native applications introduce some complexity that can affect your recovery time, especially if your data protection isn’t built for the cloud.

The stats below show just how common and devastating downtime can be on your revenue, productivity, reputation, and more. But there’s good news: Downtime doesn’t have to bring you down. Read on to find out how the right solution can boost your application resiliency and dramatically reduce the cost of downtime for your cloud-native apps.

How Common is Downtime Really?

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System or application IT downtime happens in every organization, which is why it’s so important to have a recovery plan. And instances of downtime—and their consequences—are going up, research suggests.

For example, according to Uptime Institute’s 2022 Data Center Resiliency Survey, the vast majority (80%) of data center managers and operators experienced at least one outage in the last three years. And Forrester’s Costs of Planned and Unplanned Downtime Report found that 41% were hit with unexpected downtime every week or month.

But not all outages are equal. Severity matters, too.

  • In 2021 alone, 76% of businesses lost data as a result of downtime, Acronis reports.
  • 20% of businesses surveyed by Uptime reported a significant outage in the last three years that damaged their reputation, revenue, and compliance adherence.

But why does downtime happen in the first place? And what are the most common reasons? Let’s take a look.

📊Get the full infographic: The Cost of Downtime on Your Bottom Line

The Most Common Causes of Application Downtime

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From ransomware to power supply issues, downtime can happen for a variety of reasons. However, a few causes are more common than others.

Cyberattacks

Cyberattacks are on the rise, posing huge risks to your data and customers.

Human Error

Downtime doesn’t happen due to outside forces alone. Oftentimes, it’s because of mistakes made from those closest to your infrastructure. For instance, human error accounted for 40% of significant outages over the last three years, reports Uptime Institute. But what kind of human errors cause outages in the first place?

The same study suggests that outages caused by human error are overwhelmingly due to flaws in procedures—either with staff not following them properly or from inadequate processes themselves.

Networking Issues

Aside from external forces and internal errors, the other most common cause of downtime has to do with your network. In fact, data center managers reported networking problems such as software and system issues as the number one cause of downtime over the last three years.

And Acronis’ study also found that system crashes topped the list of downtime causes, accounting for 52% of instances.

So why are networking issues causing downtime so frequently? Data center managers point to upticks in the use of complex infrastructures like cloud technology and hybrid architectures.

To reduce these issues, it’s critical to have data protection that works specifically for these complex environments. You can read more about the top protection solutions for the cloud here.

With downtime happening so frequently due to these common causes, the next question is: What are the consequences?

How Much Does Downtime Cost a Company?

The average cost of downtime is significant. Each minute costs an average of $9,000, according to the Ponemon Institute, bringing the downtime cost per hour to over $500,000. And that was from research done in 2015.

More recent research from Uptime Institute’s 2022 Outage Analysis Report found that downtime costs continue to rise:

  • Over 60% of outages cost more than $100,000, an increase from 39% in 2019.
  • 15% of outages cost more than $1 million, an increase from 11% in 2019.

And the more frequently you experience downtime, the higher the cost to your organization. For example, companies with frequent downtime have 16x higher costs than those who don’t, according to LogicMonitor’s IT Outage Impact Study.

The risk of downtime increases depending on your industry, too. High risk industries include:

  • Banking and finance
  • Government
  • Healthcare
  • Manufacturing
  • Media and communications

Downtime for these industries comes with a much higher price tag—up to $5 million per hour, suggests ITIC research.

While some of these numbers are astronomical, the costs vary widely, depending on the size of your organization, how extensive the outage is, how long it lasts, and a number of other factors. The stats above are averages, so it’s a good idea to understand your own outage costs.

Want to know how to calculate the cost of application downtime for your organization? Atlassian recommends this simple formula: Multiply your minutes of downtime by the cost per minute. You can use a lower cost per minute for smaller businesses and a higher one for medium and large. They recommend $427 for small businesses and $9,000 for large ones.

For a more precise estimate, check out this downtime cost calculator.

So where do these downtime costs come from? And what are the other impacts on your business?

The Impact of Downtime on Your Business

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Downtime affects your organization in a number of ways, all of which add up to the overall cost. Some of the biggest impacts are on your productivity, revenue, reputation, and data.

IDC’s Worldwide State of Data Protection & DR Survey dives deep into each of these aspects. Here are some of their findings.

  • Nearly half of all data disruptions caused lost productivity.
  • Over 30% of outages resulted in a direct revenue loss.
  • About 40% of disruptions led to some sort of brand reputation damage.
  • 43% of organizations experienced data loss as a result of outages.

In addition to these impacts, they also pointed out that nearly 50% of data outages caused employees to work overtime, another impact to your bottom line.

So what can you do about it?

How to Reduce the Cost of Downtime

While you can’t completely eliminate downtime, you can reduce its severity. Part of that involves testing your recovery plans and processes regularly, something that only 31% of organizations do more than once a year, reports Forrester. Doing so can make a huge difference when an unexpected outage occurs.

Something else that can help? Choosing and investing in the right solutions to backup and recover your data. In fact, this is one of Forrester’s key findings in their downtime costs report, and you can reap huge rewards as a result.

The report states:

“IT leaders must consider technologies that decrease business disruption and increase availability levels. Such investments will result in greater business productivity and higher revenue.”

Look for a platform that can help you set disaster recovery plans so backups happen automatically and according to your needs. And make sure you invest in an option that’s built for the technology you’re using—legacy solutions aren’t cut out for the cloud, afterall.

If you’re in the market for cloud-native data protection, may we suggest Trilio? Learn more about how we can help you bounce back from downtime fast by requesting a demo or exploring TrilioVault for Kubernetes.

Don’t Let Downtime Damper Your Resiliency

The effects of downtime on your business can be devastating, so don’t leave your ability to recover quickly to chance. Instead, invest in the right platforms, processes, and people to build resilient applications that hit SLAs and continue to operate in the face of failure.

Want to learn more about bouncing back from disaster? Check out this free eBook: The Key Benchmarks for Realizing Application Resiliency

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