How to lose 60 million dollars

Mobile device with Facebook app scribbled out

Chances are you were one of the many people who found themselves with a little extra free time on Monday. If you are one of the nearly 3 billion people to have a Facebook account, 1.3 billion to use Facebook Messenger, 1 billion who use Instagram, 2 billion on WhatsApp, and almost 2 million owners of an Oculus virtual reality gaming headset, you may have wondered if your internet was down, and you likely found yourself checking your accounts for hours to see if your apps were working again. Due to an internal error, all the services run by Facebook were unavailable worldwide for nearly six hours, leaving many to scramble around the internet, looking for answers. The reason for the issue and why it took so long to resolve, according to Facebook, was "caused not by malicious activity, but an error of our own making", and that "our engineering teams have learned that configuration changes on the backbone routers that coordinate network traffic between our data centers caused issues that interrupted this communication. This disruption to network traffic had a cascading effect on the way our data centers communicate, bringing our services to a halt."

Though some users were only affected in the sense that they were unable to scroll through their favorite social media apps for a few hours, which might have been beneficial to some, many others were more negatively affected by the downtime. Many people use these apps as their main form of communication, whether it be through chatting or video chatting on Facebook Messenger or as their primary way to make phone calls. Without these apps, many people, particularly those needing to make international calls, found themselves unable to reach their contacts until services were restored. Also affected were the growing number of businesses that rely on Facebook and Instagram to communicate with their customers and those who use Facebook Marketplace as their only way of selling products. Without access to the websites or apps that they use to run their businesses, many people were essentially left unable to work for nearly an entire day, therefore losing potential sales and new customers. Not only were some people unable to make potential sales, but for some users of WhatsApp, they were unable to access their finances, as many people rely on the app for their banking needs.

Facebook themselves saw a sizeable hit to their earnings due to the outage. It was reported that the company lost around $164,000 in revenue per minute during the down time, equaling nearly $60 million in losses. This loss seems to have played a part in Facebook losing their place in the so-called "trillion dollar club." After Monday's downtime, the company is now $80 billion short of $1 trillion. Stocks were also depressed, with shares falling 4.9%, for a total of nearly $48 billion in lost market capitalization. Mark Zuckerberg, Facebook's founder and Chief Executive, also has recently lost his place as the fifth richest person according to Forbes, being knocked down to sixth place due to $6 billion lost. These recent tough times, coupled with the recent whistleblower claims against Facebook, may show that while Facebook has been a handy tool, it may not be wise to rely on it completely, especially for business purposes.

If you rely on Facebook or other social media services as your main business presence instead of your own website, you are always at risk of downtime that can reduce your profits. Because you do not own these services or your presence on them, there is no recourse for when downtimes happen, and you will have less of a chance of knowing in advance when problems may arise. Without a skilled web developer working to keep your assets online, you also won't get answers as to why services are down, and will be forced to continue checking and hoping that services are restored. While it makes sense to have a presence on social media, it is obvious after seeing Monday's downtime that it also makes sense to have your own dedicated website that users can still access whenever global outages arise. If you have a website, you have a place for users to find you when your social media pages or profiles are unavailable, and you have an advantage over those who rely on Facebook as their main way to reach users.

If you want to protect your web presence and branch out from having your business existing solely on social media, reach out to us! We are located in New Albany in Southern Indiana, right across the Ohio River from Louisville, Kentucky, and we are ready and able to take on new challenges, no matter where you are located!

social media