Due to the ever-increasing vulnerabilities of the Internet, your website is guaranteed to crash – the only question is when.
“I think that all services will have downtime”, WordPress founder Matt Mullenweg wrote in an e-mail to CNN. “No matter how much you prepare, have redundant systems, or audit, there will periodically be a black swan event that is completely unlike whatever you have experienced before. It even happens to Google! In these moments of crisis, the key is how the service and the people behind it respond.”
Have you ever lost data or had problems with files that were corrupted? Have you experienced the headaches of extended downtime or the frustration of making your site back normal again? Have you ever seen on the site layout and just wanted to revert? Perhaps a frustrated employee decided to execute a payback on the company? There can be a million reasons why your website is not what it is supposed to be. Either way, the face of your company to the world is now compromised – what do you do? What can you do?
Just imagine if this happened to you – losing your entire site due to a unknown or unpredictable security lapse. Maybe your tech team forgot to install the security patch or a myriad of possibilities that leave your website wide open to attack. You frantically try to restore the site from a previous version… but nothing is available. This is a common worry that keeps website owners up at night. eCommerce sites could lose up to thousands and even billions with any unscheduled down time: In 2008 online retailer Amazon.com had a two hour downtime. In this not time not only did it lose around $29,000 – $31,000 per minute (total loss estimated at $3.6 million) but the share price fell by 4.1% on the day – wiping around $3.12 billion off their stock market value.
A simple way for you to calculate the possible losses incurred by yourself – apply this formula:
Estimated Average Cost of hour of downtime = Employee Costs per Hour * Fraction Employees Affected by Outage + Average Revenue per Hour * Fraction Revenue Affected by Outage
- Employee Costs per Hour: total salaries and benefits of employees per week divided by the average number of working hours
- Average Revenue per Hour: total revenue per week divided by average number of open hours
- “Fraction Employees Affected by Outage” and “Fraction Revenue Affected by Outage” are just educated guesses or plausible ranges
Even so, it is also only just a conservative estimate as it ignores cost of repair, such as cost of operator overtime or bringing in consultants. This formula ignores daily, seasonal variations in revenue. Also ignoring indirect costs of outages like poor company morale (reducing productivity for periods that far exceed the outage. Frequent outages can lead to a loss of confidence in the IT team and its skills (IT blamed for everything). It can eventually lead to individual departments hiring their own IT people, which lead to higher direct costsIt is not just the cost of revenue not being made, it also involves the manhours lost. In this way, you can see that losing your website impacts your business in a serious way.
Here an example: Sun Microsystems 2001
•Revenue $12.5B/year, with 43,314 employees
•Revenue per hour (24×5): ~ $2,000k
•If outage affected 10% revenue: ~ $200,000
• Assume avg. annual salary is $100,000 – More engineers than Amazon, so 20% higher
• $4331M/year, or $83M / week for all staff
• @ 50 hours / week => ~ $1,660,000 per hour
• If outage affects 50% employees: ~$830,000
• Total: ~ $1,030,000 / hour
That is not an insignificant number. Minutes and seconds of restoration of a site can lead to salvation or damnation of a business
When you finally get it back online, you discover it’s been blacklisted by Google because of a hacker. It happens more often than you think. Every day, it is estimated that 6,000 websites gets hacked and blacklisted by Google and other search engines 2 Once blacklisted, all modern browsers like Internet Explorer, Firefox, Safari will block access to the site. This leads to drop in visitors, sales and destroys the reputation of the site.
It is henceforth important to be prepared for anything – after all your business and reputation may depend on it. Protect your website from any data disaster, large or small with backup: protecting your hard work and effort. Take comfort in knowing that your information is always safe, secure, easily be restored and much more.