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While You Were Eating Lunch Yesterday, Amazon Lost $4.6 Million in Sales

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Yesterday afternoon, at 2:48 pm ET, our staff noticed that Amazon's website appeared to be down, and the ever-official downforeveryoneorjustme.com confirmed it. The e-commerce site continued to fail for the next 40 minutes (some media outlets claim that it was for as little as 15 minutes, but Buzzfeed agrees with us), leaving us unable to buy things like a 24-pack of medicated lip balm or to test our newly-discovered Amazon Name Game to find out what our "spirit product" is.

While 40 minutes isn't an outrageous amount of time of inactivity, the stakes are naturally much higher for the mega-retailer. In fact, the last time Amazon saw a substantial outage — in late January of 2013, for 49 minutes — Wired estimated that the company lost about $5.7 million in sales, or the equivalent of selling about 28,643 Kindle Fire HDs. By those estimates, yesterday's 40-minute outage cost Amazon $4.6 million in lost sales.

However, that speculative number is based on average per-minute sales in 2012, and it's likely that the effects of going dark on a Monday afternoon in August are much less financially devastating than they would be during other times of the year. Moreover, Buzzfeed offered a much lower estimate — about $2.6 million — since the site based its calculations on net sales in 2012 for North America alone. Still, that's a pretty staggering amount of money for a period of time that's shorter than most people's lunch break.

Regardless of how much money and deal-shopping time was lost during the blip, shoppers still got some great tweets out of it, and we've displayed some of our favorites below. So maybe, for the internet at large it was a win?


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Features Director

Lindsay Sakraida is the DealNews Features Director. She specializes in writing about shopping trends and lifestyle subjects. She's also obsessed with music, movies, and tennis. Follow her on Twitter at @LinSakraida.
Please note that, although prices sometimes fluctuate or expire unexpectedly, all products and deals mentioned in this feature were available at the lowest total price we could find at the time of publication (unless otherwise specified).
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3 comments
robinteractive
It seems likely the outage cost them some sales. But taking a per-minute average of sales and extrapolating it would be inaccurate. Some portion of the annual sales figures for Amazon are subscribe and save, and those would not be impacted in any way. Other sales end up being deferred. "Hmm. Amazon is down. I guess I'll just check back later and place my order."

On the flip side, as was pointed out by brianlmoon, Amazon powers a lot of the Internet, and confidence in their infrastructure is key. If companies get spooked by the outage (particularly if/when it happens again) and opt to host some of their code elsewhere, then there's additional lost revenue.

Or, as my neighbor with the tinfoil hat would say, "I bet it was the NSA, man..."
brianlmoon
What is worse is that not only Amazon was down. Amazon hosts their site on the same infrastructure that they resell to thousands of web companies. Along with Amazon, this outage took out many online properties. Sadly for these other companies, there are many more AWS outages that don't affect Amazon and don't receive the 40 minute turnaround time. And these are not small sites. The servers for apps like Instagram are hosted there. As are all of Netflix infrastructure. Just search for "aws outage" and you will see what I mean. My favorite tweet during one such outage was "I thought the Internet was world wide. It turns out it is all hosted in a data center in Virginia." As that is where a large part of the Amazon infrastructure is housed.
jononymouse
Disaster Recovery / business continuity is so important !
40 min. is a good recovery time. It is a shame so many businesses do not incorporate business continuity into their IT infrastructure. The estimated $4.6M loss in sales comes to about $1M for every 10 mins.
The financial industry has a regulatory agency (FED) that mandates DR recovery times the medical industry has no such regulatory agency or a mandated recovery time. It is time our medical industry come up to speed.
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