It can be easy to overlook some enterprise IT statistics, but the average cost, the average loss, of a data center outage is too high to ignore. According to a research report by the Ponemon Institute, a data center outage now costs around $9,000 per minute. As if that weren’t enough, the cost of an average data center outage has increase from $505,502 in 2010 to $750,537 in 2015, growing 38%. What’s causing the data center costs to increase and the losses to reach such alarming rates?

The Growth of Data Center-Reliant Operations

In its study of 63 data centers, the Ponemon Institute pointed to the growth of social media networks, the Internet of Things, the cloud and mobility as the root causes of the soaring data center outage costs. Their evidence jumps off the page – and points to a sizable shift in just a few short years:

  • The number of Facebook users has climbed to 1.5 billion in 2015, up from 500 million in 2010.
  • While 500,000 smartphones shipped in 2011, around 1.5 billion were sent out in 2015.
  • Goldman Sachs has predicted a compound annual growth rate of 30% between 2013 and 2018 for the cloud.
  • According to the IDC, the Internet of Things is set to grow from $655.8 billion in 2014 to $1.7 trillion in 2020.

All of these technologies are reliant on data centers, which has made data center growth a top priority. And as a result, when data centers go down, costs pile up.

How Data Center Outage Costs Affect Enterprises

Cost of unplanned outages for the 63 data centers studied by the Ponemon Institute.
Cost of unplanned outages for the 63 data centers studied by the Ponemon Institute.

 

The costs to data centers add up quickly, and it’s not just the facilities that pay a hefty price. Enterprises also face direct expenses – the productivity and resource costs created by downtime. Indirect expenses are also generated when IT departments work to solve issues related to outages, and organizations can even lose future opportunities if their reputation is damaged by the downtime.

The Increasing Importance of Data Centers

As data centers become even more critical to enterprise IT operations, the costs of outages will only increase and the importance of contingency plans, disaster recovery and cloud retractability become paramount. When an organization places its applications and data in a data center or in the cloud, there may be no way to ensure proper performance and uninterrupted access.

Outages – along with data losses and corruption – can have a significant financial and reputational impact on organizations. As a result, it falls on companies to do their due diligence when considering data center services, including understanding their connectivity to these increasingly important facilities.

To learn more about NEF’s advisement services for data transport, colocation and cloud services, including cloud exit strategies, talk with us today.

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