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Study: Data Center Downtime Cost $7,900 Per Minute in 2013

A 2013 Ponemon study estimated average data center downtime costs at $7,900 per minute, based on 67 U.S. facilities and a broad range of direct and indirect losses.
From TheFinanceBase Team3 min to read

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A 2013 Ponemon Institute study estimated that unplanned data center downtime cost an average of $7,900 per minute. That is a historical benchmark—not a current rate or a bill every data center should expect to face. The estimate came from 67 U.S. data centers and counted a broad range of consequences, beyond lost sales.

Where the $7,900-per-minute figure came from

Ponemon Institute’s December 2013 Cost of Data Center Outages study, sponsored by Emerson Network Power, reported an average downtime cost of $7,900 per minute. The study said that figure was 41% higher than the $5,600-per-minute average reported in its 2010 study. The 2013 report is the primary source for the study’s scope and findings.

The estimate was based on 67 independent data centers in the United States. Each had experienced at least one complete or partial unplanned outage in the preceding 12 months. This was a study sample, not a census of U.S. facilities or data centers worldwide.

What the estimate counted

The researchers used activity-based costing to estimate direct and indirect consequences. The cost categories included damage to mission-critical data, lost productivity, damage to equipment and other assets, outage detection and remediation, legal and regulatory consequences, reduced stakeholder confidence, and harm to brand reputation. The $7,900 figure therefore should not be read as a simple estimate of sales lost during each minute.

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The report found that total costs were systematically related to outage duration and data center size, and that IT equipment failure was the most expensive root cause among those assessed. Those are findings from this particular sample, not universal rules that predict the cost of any specific outage.

How the study’s incident estimates compare

The average cost per incident and the per-minute figure describe different views of the study’s results. The report gave an average incident cost of $690,204. Data Center Dynamics’ December 2013 coverage reported an average incident length of 86 minutes and rounded the average cost to about $690,200. It also reported different averages for total and partial outages:

2013 study measure Reported estimate Source and qualification
Average downtime cost $7,900 per minute Ponemon Institute, sponsored by Emerson Network Power, 2013; average from the study sample.
Average cost per incident $690,204 Ponemon Institute, 2013; the report’s average.
Average incident length 86 minutes Data Center Dynamics, December 2013, reporting the Ponemon study.
Average total-outage cost Approximately $901,500 Data Center Dynamics, December 2013, reporting the Ponemon study.
Average partial-outage cost Approximately $350,400 Data Center Dynamics, December 2013, reporting the Ponemon study.

The per-minute figure is an average across the study, not a uniform meter that can be multiplied by any outage duration to predict an organization’s loss. The separate total- and partial-outage estimates illustrate why severity matters; duration, facility size, and which direct and indirect costs are counted also affect the result.

Is $7,900 per minute a current estimate?

No. It is a figure reported from 2013 data and should be identified with that year whenever quoted. Ponemon’s official listing identifies a 2016 study as the third installment in the series, following studies in 2010 and 2013. That confirms later research existed, but it does not update the 2013 per-minute estimate. The evidence available here does not establish a newer, comparable per-minute benchmark.

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For context on how the 2013 number was reported at the time, see Data Center Dynamics’ December 2013 coverage and Data Center Knowledge’s report. Neither makes the figure a current price for downtime.

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What the figure can—and cannot—tell a business

The study shows why downtime costs can extend beyond immediate lost transactions: disruption can also affect staff productivity, data, equipment, compliance, and trust. But its sample and date limit how precisely it can be applied to an individual organization. A business evaluating its own exposure needs to consider its outage severity, likely duration, facility scale, and which direct and indirect impacts matter to it; the 2013 average alone cannot supply that calculation.

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