Data center outages come with whopping $8K per minute price tag

Have an outage? Expect to lose money, big time.
By Erin McCann
08:02 AM
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IT outages come with monster pricetag
The healthcare industry depends on data – data for clinical metrics, data for patient care, billing and reporting. So unplanned data center outages can be a real downer. Pun intended. 
 
How much of a downer? Well, in addition to all of the expected consequences of business and care disruption, there’s also the financial cost incurred due to system outages. And it’s no small number. 
 
Healthcare organizations face average costs of $690,000 per outage incident, according to the findings of a new Ponemon Institute/Emerson Network Power report, roughly a 41 percent increase since 2010. 
 
Larger groups with more extensive IT systems, however, could pay out nearly $1.74 million per incident. 
 
 
Those numbers, of course, depend on several factors which include the length of data downtime and complexity, but overall, groups should expect to fork over $7,900 per minute of outage. 
 
Seeing as data centers today now support more critical IT systems, the cost increase associated with unplanned data outages was expected, said Larry Ponemon, chairman and founder of the privacy and security research firm Ponemon Institute, in a press statement. But the 41 percent bigger price tag was much higher than expected.
 
"This increase in cost underscores the importance for organizations to make it a priority to minimize the risk of downtime that can potentially cost thousands of dollars per minute," said Ponemon. 
 
The report included responses from 450 data center professionals on the root causes and frequency of data center downtimes. Respondents experienced an average of two complete data center outages over the past two years, while partial outages occurred six times in the same timeframe. The average number of device-level outages, or those limited to individual servers was the highest at 11. 
 
The most significant cost organizations incurred after data center outages were business disruption costs, pegged at an average of $238,717; lost revenue costs, averaging $183,724; and end-user productivity, an average of $140,543 lost per incident, according to the report. 
 
UPS system failures, accidental/human errors, cyber crime, weather incursions and water/heat or CRAC failure account for the lion's share of data center outages. However, IT equipment failures, which are associated with only 4 percent of unplanned downtimes, account for the highest in total expenses, at $959,000 per incident.  
 
 
Out of 15 industry sectors covered in the report, healthcare saw the 7th highest costs, above retail, transportation, technology and software, co-location, services, media, education, public sector and hospitality sectors. Communications and consumer product companies saw the highest costs associated with data center outages.  
 
Just this August, the 24-hospital Sutter Health System in Northern California reported that a software glitch rendered its $1 billion electronic health record system inaccessible to clinical staff. 
 
According to reports, the outages across the hospitals lasted a full day. 
 
"Many of the families became concerned because they noticed the patients were not getting their medications throughout the day," explained Mike Hill, RN, at Sutter’s Alta Bates Summit Medical Center and California Nurses Association representative for the hospital, back in August. "Meds were not given for the entire day for many of the patients."