Outage Costs

Outage Costs - Redundancy and Resiliency

The Real Cost of Outages to your Business

Have you ever considered how fragile your business really is?

How long could your business operate without your Internet, network or phone systems working? Imagine if all your sites went off-air – how damaging would that be?

The current pandemic has shown just how devastating an enforced shutdown has been to our economy and businesses.  Unplanned outages can compound this further.

During times of uncertainty like this the last thing you want to be worrying about is if your business infrastructure is capable of coping with technology based outages. But they do occur relatively frequently all across Australia, even to the largest and supposedly most reliable telco providers.

Given how complex today’s telecommunications and data networks are, it is no surprise that problems arise. Consider the amount of cables that are buried underground to transport this data everywhere. Even wireless towers, like those that power the mobile phone network, and future 5G networks, are connected back to aggregation points and data centres by underground fibre optic cables.

Broken cable causing outage

Outages happen

But all this complexity and physical infrastructure is really quite fragile – people cut cables, people accidently reboot servers, people make mistakes. Not to mention all the software that controls these system – complex software, written by people, which constantly updates and always seems to introduce some new bug.

Over the past few years even Telstra has been associated with a number of high profile failures – responsible for ATM and business EFTPOS outages, Myki downtime, Jetstar check-in system crashes, NAB banking issues, and Government and Health system connectivity problems.

Even multinational companies at the bleeding edge of technology have some bad days – consider the recent Cloudflare DNS outage which caused issues for the largest cloud providers AWS, Microsoft and Google.

Outages happen. And frankly, in such a complex environment they are impossible to predict or prevent completely. People cause these outages – and we aren’t getting rid of people anytime soon!

That all sounds a bit gloomy! But what does that have to do with my business?

The real (and hidden) costs of outages

It’s worth considering how much money an outage really does cost your business and compare that to adding some redundant systems into your operation.

For a simple example, let’s imagine your business generates $5 million in revenue each year, and if your Internet or phone system is down you are unable to process orders, close sales or reach your customers. If you are open Mon-Fri, that allows around 260 trading days.

A single day’s outage could cost you nearly $20k in revenue or $2400 per trading hour!

Not to mention other hidden costs, like damage to your brand reputation, or knock-on effects impacting your ability to deliver projects or services on time. Additionally, your staff have to spend their time mopping up, rather than being engaged in productive work.

Suddenly adding some redundant options seems like a cheap insurance policy.

See what an outage could be costing you

Annual Revenue

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Daily Cost

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Hourly Cost

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What can be done to prevent these outages?

The good news is that it is possible to mitigate these issues and minimise the chance or length of an outage with some planning. At the simplest level you want to ensure that you have a plan B.

If one of your critical systems fail, it is vital there is an automatic cutover to an alternate. Eg, a 4G/5G backup for your data, or a way of quickly diverting your phone system to your mobiles.

There are plenty of other ways to reduce your outage risks. Everything can be duplicated, but where do you stop? Do you consider duplicating your data link, your phone system, your office itself? What about your staff – ideally you would clone yourself!

Obviously, there must be a balance between risk, practicality and commercials. A balancing act that needs a safety net.

In our next article we will explore the different ways of achieving true redundancy via network diversity, resilient controllers, redundant switches and more.

In the meantime, if you are concerned about your phone or network outage plans….call us today on 03 8542 8542 or via our online form to see how we can mitigate your risk and assist you with outage planning.

Mathew Jameson
by Mat Jameson
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