Study: Major Cloud Outage Could Cost $15 Billion
A study from Lloyd’s of London and AIR Worldwide reveals that a failure at just one top cloud service provider could cost the U.S. economy up to $15 billion, with much of the burden falling to small and medium-sized businesses. The study found that if one provider went down for three to six days, up to 12.4 million organizations would be affected.
Lloyd’s said businesses outside the Fortune 1000 would suffer nearly 67 percent of the losses from a failing cloud service provider. Only a fifth of the predicted $15 billion economic loss would be covered by insurance, with large companies more likely than smaller ones to have cover in place, according to the study. More than half the costs would hit the manufacturing industry, with direct economic losses of $8.6 billion.
“Clouds can fail or be brought down in many ways — ranging from malicious attacks by terrorists to lighting strikes, flooding or simply a mundane error by an employee,” said Trevor Maynard, head of innovation at Lloyd’s.