£3.7bn: the cost of internet failures to UK businesses

UK businesses lost over 50 million hours and £3.7 billion due to internet failures in 2023, according to a new report from Beaming, a specialist business ISP. Reliance on connectivity for trading and operational activities has increased among businesses in the last five years, and the cost of missed sales, lost productivity and other disruptions due to downtime has risen by 400%.

Beaming’s report – The Cost of Downtime: The Impact of Outages on UK Businesses in 2023 – shares its analysis of a Censuswide survey of businesses using connectivity from various internet service providers, and advice to help companies reduce downtime levels and costs. The report reveals that:

Cumulatively, UK businesses experienced 8.8 million internet failures and 50.5 million hours of disruptive downtime in 2023, where the ability to trade or access vital services was impaired.
The amount of time businesses lost to connectivity failures in 2023 was a fifth lower than in 2018 when previous Beaming research found that firms lost 60 million hours to downtime. However, the cost of that downtime has increased fivefold: from £742 million in 2018 to £3.7 billion in 2023. 
Heightened dependence on connectivity for communication, e-commerce and access to cloud applications means 15% of UK businesses, some 850,000 nationwide, would now start losing money the moment their connectivity fails. This is 81,000 more firms than five years ago. 
During 8-hour internet outages – a standard working day – 39% of businesses now would lose money. This compares to 34% at the end of 2018 and represents an increase of 240,000 companies nationwide.
The median time for financial losses to kick in from internet failures is 6 hours for businesses with employees today. This applies to employers of all sizes, from micro-companies with 2 to 10 employees to big companies with more than 250 staff members. 
SMEs bore the brunt of internet disruptions in 2023, enduring an average of 3 to 4 failures and 19 hours of downtime each. Those working a standard 8-hour day and 5-day week lose more than two working days a year to downtime, around 1% of their productive time.
The hospitality, IT, and manufacturing sectors experienced the highest levels of internet downtime and the biggest financial impact. On average, hospitality businesses lost 27 hours to downtime in 2023, while companies in the IT industry lost an estimated £555 million to connectivity failures.

Sonia Blizzard, Managing Director of Beaming, said: “The adoption of digital technologies has been a lifeline for business survival and a driver for increased prosperity in recent years, but this has come with a heightened dependence on connectivity. Companies are demanding more of their connectivity than ever before, and those relying on e-commerce, automation and public cloud services then incur the highest costs due to internet downtime.”

“Greater use of faster, stronger, more resilient forms of connectivity has helped reduce downtime, whilst downtime has become much more costly. Good planning, higher capacity services and expert support are vital now to reduce the risk of internet failure and the associated financial fallout.” 

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