The financial impact of Facebook’s outage
Just a few days ago, Facebook forced millions of people to visit their rivals’ social media platforms and to find other ways to entertain themselves for a whole six hours.
Its latest outage was the company’s largest to date, affecting not just Facebook but Instagram and WhatsApp, too, as subsidiary companies owned by Zuckerberg’s group.
The company blamed the failure on a technological issue, but this wasn’t a comfort to many of its customers, i.e. the people who run their livelihoods from the platform or those that pay a fortune in advertising costs to promote their goods. A company that size should surely have back up servers/offices/staff to ensure continuity—let’s face it, if Facebook doesn’t have enough funds or resources to stop things like this happening, what company would?
The degree to which this lack of access affected people varied. Some people reported that they’d had a lovely evening, the enforced break giving them a rare rest from the world of social media. They read books, watched television, and generally had a much more chilled out time whilst Facebook’s systems were down. Maybe it gave some people an insight into how much time they spent on these platforms, and how little they actually impact their lives when not there. After all, humans survived for two millennia using other forms of entertainment.
For all its investment into Artificial Intelligence, it was a team of people who eventually managed to access Facebook’s failing infrastructure and press the reset button. Fans of the IT Crowd would love this reference…’have you tried turning it off and on again?’
In my household, we first blamed the incident on our internet service, as we’ve just switched provider. Then we considered the problem to be our individual phones, before learning of Facebook’s outage. That’s telling to me, that we’d simply assume it would be a problem at our end rather than an issue with a titan of a business, in which the three brands mentioned have an estimated total worth of $586bn. You just don’t imagine these things will happen when a company has that much to invest in its security and infrastructure.
There are differing reports on how much Facebook lost in revenue during the time it was offline. One news outlet broke it down from their ad revenue last year, and suggested Facebook’s loss was approximately $80 million during the six-hour outage.
It wasn’t just Facebook that lost money, though. Mark Donnelly of HUH Clothing said, ‘When Facebook went down, we lost thousands in sales. It may not sound like a lot to others but missing out on four or five hours of sales could be the difference between paying the electricity bill or rent for the month.’
Media site DNYUZ told the story of Douglas Veney, a Cleveland gamer who had a lot of content ready to post during the time Facebook was down, in order to promote one of his upcoming livestreams. Though not someone who relies on the income from his gaming to meet his bills, he knows plenty of gamers that do. Regardless, he found the experience ‘scary’. He said, ‘I have 300,000 followers (on Facebook)—you just cross your fingers that nothing’s gone when it comes back.’
I know which camp I have more sympathy for when it comes to lost revenue. Facebook earns a lot of money from its customers and the public as a whole; it’s placed at number 34 on Fortune 500’s 2020 list of most profitable companies across the globe. The very least it should provide is uninterrupted service when people’s livelihoods are at stake. You know, Mark, the little people who put your company where it is today…
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