Delta: Data Center Outage Cost Us $150M

Price tag extraordinarily high in comparison to data center industry average

Yevgeniy Sverdlik

September 8, 2016

2 Min Read
Delta: Data Center Outage Cost Us $150M
Travelers wait in line at the Delta check-in counter at LaGuardia Airport , August 8, 2016 in the Queens borough of New York City. Delta flights around the globe were grounded and delayed on Monday morning due to a system outage. (Photo by Drew Angerer/Getty Images)

The Delta Airlines data center outage that grounded about 2,000 flights over the span of three days in August cost the company $150 million, the airline’s representatives told the audience of a transportation industry conference in Boston Wednesday.

The number is extraordinarily high, illustrating that major airlines have a lot more at stake when designing and managing critical infrastructure than most other data center operators.

The average cost of a single data center outage today is about $730,000, according to an Emerson Network Power-sponsored study by the Ponemon Institute, released earlier this year. Of the 60-plus data center operators surveyed for the report (PDF, registration required), the costliest reported outage caused the operator to lose about $2.4 million.

Ponemon looks at a fairly comprehensive set of impacts when assessing outage costs. In addition to things like damage to mission-critical data, equipment damage, and impact on productivity, the study takes into account losses due to legal and regulatory impact, loss of confidence and trust, and impact on brand and reputation.

But major airlines like Delta are a special case, in which there are costs beyond Ponemon’s scope. Delta, whose outage was caused by electrical-equipment failure, was obligated to issue refunds to customers whose flights were cancelled or significantly delayed. Considering the volume of flights that were cancelled after its five-hour data center outage in Atlanta, the incident’s price tag isn’t as surprising.

Southwest, another airline that presented at this week’s investor conference, experienced an outage in July, which led it to cancel flights over three days. While it didn’t disclose the exact cost of the outage, CNN estimated it to have been at least $177 million in lost passenger revenue, based on ratios Southwest did provide.

See also: Delta System Failure Marks Wake-Up Call for Airline Industry

Delta and Southwest spoke at the Cowen and Company Global Transportation Conference.

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