Emerson Network Power, Ponemon Institute Study Quantifies Cost of Data Center Downtime

Part Two of National Report reveals costs of unplanned outages can add up to thousands of dollars in a matter of minutes

Columbus, Ohio [May 10, 2011] – Data center downtime comes with a steep price tag, costing businesses more than $5,000 per minute according to a new Ponemon Institute study of U.S.-based data centers. Emerson Network Power, a business of Emerson (NYSE: EMR) and the global leader in enabling Business-Critical Continuity™ sponsored the study and today released a report titled “Understanding the Cost of Data Center Downtime: An Analysis of the Financial Impact of Infrastructure Vulnerability” that reveals and analyzes the financial impact of infrastructure vulnerability. The Emerson cost of downtime report provides recommendations for fortifying data center infrastructure to minimize downtime costs and tactics for gaining a higher return on IT investment.

The report was based on a new Ponemon Institute study, “Calculating the Cost of Data Center Outages”, which analyzed costs at 41 data centers across varying industry segments with a minimum size of 2,500 square feet, to identify the “bottom line” costs of data center downtime. The report based on this study provides a comprehensive analysis of the direct, indirect and opportunity costs from data center outages, including damage to mission-critical data, impact of downtime on organizational productivity, legal and regulatory repercussions, and lost confidence and trust among key stakeholders. It also examines how power, cooling, monitoring and service inadequacies can contribute to a facility’s risk.

The complete Ponemon Institute report is available online at www.Liebert.com. Highlights of the report include:

  • Average cost of data center downtime across industries was approximately $5,600 per minute.
  • The average reported incident length was 90 minutes, resulting in average cost per incident of approximately $505,500.
  • For a total data center outage, which had an average recovery time of 134 minutes, average costs were approximately $680,000.
  • For a partial data center outage, which averaged 59 minutes in length, average costs were approximately $258,000.

For enterprises with revenue models that depend on the data center’s ability to deliver IT and networking services to customers – such as telecommunications service providers and e-commerce companies – downtime can be particularly costly, with the highest cost of a single event topping $1 million (more than $11,000 per minute).

“With the increase in reliance on IT systems to support business-critical applications, a single downtime event now has the potential to significantly impact the profitability – and in extreme cases, the viability – of an enterprise,” said Larry Ponemon, Ph.D., chairman and founder, the Ponemon Institute, a research center focused on privacy, data protection and information security policy. “An inadequate data center infrastructure will contribute to recurring downtime events and result in significant financial losses as well as permanent damage to a company’s reputation and customer goodwill.”

A 2010 Ponemon Institute study commissioned by Emerson Network Power surveyed more than 450 U.S.-based data center professionals and focused on the root causes and frequency of data center downtime. Regarding the frequency of outages, respondents experienced 2.5 complete data center outages during the past two years. Partial data center outages, or those limited to certain racks, occurred 6.8 times in the same timeframe. The estimated number of device-level outages, or those limited to individual servers, was the highest at 11.3.

Respondents of the 2010 survey most frequently cited uninterruptible power supply (UPS) battery failure (65 percent), exceeding UPS capacity (53 percent), accidental emergency power off (EPO)/human error (51 percent) and UPS equipment failure (49 percent) as the causes of unplanned data center outages.

“Our customers are on the front lines of data center management so they understand the importance of designing and managing their data center to reduce the risk of downtime,” said Peter Panfil, vice president and general manager, Emerson Network Power’s AC Power business in North America. “This report, along with the previous Ponemon study, gives their organizations the data to support more informed business decisions regarding the cost associated with eliminating vulnerabilities compared to the costs associated with not taking action.”

Full details of the 2011 Ponemon Institute study and the companion Emerson report are available online, along with the Ponemon Institute’s first report in the two-part series, which focuses on root causes and frequency of data center downtime. For more information on Liebert technologies and services from Emerson Network Power, visit www.Liebert.com.

About Emerson Network Power
Emerson Network Power, a business of Emerson, is the global leader in enabling Business-Critical Continuity™ from grid to chip for telecommunication networks, data centers, health care and industrial facilities. Emerson Network Power provides innovative solutions and expertise in areas including AC and DC power and precision cooling systems, embedded computing and power, integrated racks and enclosures, power switching and controls, infrastructure management, and connectivity. All solutions are supported globally by local Emerson Network Power service technicians. Liebert AC power, precision cooling and monitoring products and services from Emerson Network Power deliver Efficiency Without Compromise™ by helping customers optimize their data center infrastructure to reduce costs and deliver high availability. For more information, visit www.Liebert.com, www.EmersonNetworkPower.com or www.Eu.EmersonNetworkPower.com.   

About Emerson
Emerson, based in St. Louis, Missouri (USA), is a global leader in bringing technology and engineering together to provide innovative solutions for customers in industrial, commercial, and consumer markets through its network power, process management, industrial automation, climate technologies, and tools and storage businesses. Sales in fiscal 2010 were $21 billion. For more information, visit www.Emerson.com.