Millions lost through network downtime

Network downtime, primarily caused by server and infrastructure equipment failure, is costing businesses million of pounds a year in lost earnings.

According to analyst company Infonetics Research, network outages and degradations cost some firms as much as one per cent of total annual revenue - up to $74.6m (£47.6m) - through lost productivity.

In its latest report, The Costs of Enterprise Downtime 2003, the analyst conducted in-depth case studies of six large organisations across various industries and found companies losing up to $96,632 (£60,000) per hour of network downtime.

"Most IT managers suspect that downtime costs a ton of money," said Jeff Wilson, executive director of Infonetics Research.

"They have a sinking feeling that money is draining from the company coffers every time a server crashes, an Ethernet switch flashes yellow and then goes dark, or a service provider sends a courteous email a week after a T1 went down.

"They are right. Most organisations don't know where to start, or how to go about fixing problems when they find them.

"Tracking downtime is the first step, and that is something networking products, management vendors and service providers can make easier."

The key findings from the study are as follows:

• Servers are the number-one cause of downtime, followed closely by applications.
• Network products are another leading cause of network downtime; router, switch, and NIC failure and performance problems account for about a quarter of losses across the board.
• Revenue losses are higher than productivity losses without exception, and in many cases they are higher by far, but productivity losses are very costly and hard to pinpoint and fix.
• Service degradations are difficult to track and fix, and require investment in technologies that optimise performance, which many companies are not willing to make because the financial benefits are generally unclear.