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Amazon.com Suffers Outage: Nearly $5M Down the Drain?
First time accepted submitter Brandon Butler writes "Amazon.com, the multi-billion online retail website, experienced an outage of unknown proportions on Thursday afternoon. Rumblings of an Amazon.com outage began popping up on Twitter at about 2:40 PM ET. Multiple attempts to access the site around 3:15 PM ET on Thursday were met with the message: 'Http/1.1 Service Unavailable.' By 3:30 PM ET the site appeared to be back online for at least some users. How big of a deal is an hour-long Amazon outage? Amazon.com's latest earnings report showed that the company makes about $10.8 billion per quarter, or about $118 million per day and $4.9 million per hour." Update: 01/31 22:25 GMT by T : "Hackers claim credit."
So, if a website is down, and someone goes to buy something, that means they are unable to purchase it later when the site is back up?
The logic behind how they arrived at that number is slightly flawed.
???
I'd hate to be the one developer responsible for that bug...
Waiting for you by the bridge
Sounds more like that was 5 million in potential dollars not earned, not 5 million lost. You can't lose what you do not yet have.
This space unintentionally left blank.
The Amazon EC2 cloud hosting system was experiencing partial downtime simultaneously, cloud hosted server instances were still accessible from the outside network but were unable to communicate on the internal EC2 network - either there was something pretty serious affecting Amazon's network, or they keep their cloud hosting servers on the same specific network where they host the entire Amazon.com operation... ...Neither sounds particularly great to me?
Just because they average about $5M per hour doesnt mean that they lose that much in one hour of downtime. How many people will just order anyway after the site comes back up? Maybe the hour that service is restored they might earn $9M ...
they didn't lose that much and people decided their spatula purchase could wait a few hours
This assumes that amazon makes a constant amount every hour, as opposed to peak vs. off-peak business hours. This also assumes that the bulk of their business took their purchases elsewhere while Amazon was done, which I'm not inclined to believe is necessarily true.
Amazon probably lost money, I'm in doubt that it's anywhere close to 5M
"goodbye and hello, as always" ~Prince Corwin, from Zelazny's Amber series
Chicken feed for Amazon.
http://michaelsmith.id.au
If I want to go to Amazon to buy something and the site is down, I'll wait an hour and check again. I'm not going to suddenly not want to buy things that I want because the site went down for a little bit.
Interesting statistic, though that assumes that a one hour wait is sufficient to make $5 million worth of sales redirect to a competitor. Amazon has some level of brand loyalty and reputation compared to others, and I'd bet that Amazon sales are not equally distributed throughout the day.
I guess "Amazon might have suffered $5 million in losses" doesn't sound as interesting as claiming they actually did.
to have a Sears catolog again.I could call and just place an order to a live operator..sigh.
After many years writing software that runs most of the semiconductor fabs around the world I can say that $5M per hour lost income is nothing compared what it costs a semiconductor manufacturer to have a fab down for an hour. In that case, it STARTS at $10M in lost PROFITS, not raw income! Needless to say, they get cranky if a software bug takes the system down!
There went 2013's profit!
one click and it broke. Just one damn click....................
They'll just stay open an extra hour to make up for it???
Supplies!
The $5mm of revenue is not ALL automatically lost. The vast majority of customers will probably wait a couple of hours and then try again. Also, that number is revenue, not profit. Amazon's profit margins are thin, and sometimes even negative.
*update from foxnews*
Youserious.jpg
This assumes that people who couldn't order something from Amazon right at that moment will immediately go order it somewhere else. I'd bet that most people would just try again later and order what they want.
Maybe Amazon should consider moving to the cloud...
I was going to buy something during that period. I waited until Amazon came back, and bought it later. Problem solved. I'm not going to take my ecommerce business elsewhere because elsewhere doesn't have prime.
My job keeps me on Amazon's system constantly switching between the customer frontend and the vendor backend to make sure product pages are functional and complete. We haven't had a second of downtime today.
Just the front page was down, though. I was able to access various pages within, including product pages, but www.amazon.com itself was unavailable. Didn't try to buy anything, though.
First time accepted submitter (and networkworld.com staff writer) Brandon Butler writes overblown and hyperbolic article, gets it on the /. front page. Nearly 5 quadrillion bucks earned from ad clicks. Slashdot down the drain? Business as usual.
In what universe?
Here's Amazon's latest financial release:
http://phx.corporate-ir.net/phoenix.zhtml?c=176060&p=irol-newsArticle&ID=1779049&highlight=
Here's the important bit:
Amazon is barely breaking even. Whether or not this is an intentional strategy is another discussion, but it sure as hell ain't making 10.8 billion a quarter. It's not even making ONE HUNDREDTH of that.
nt
ATTN Amazon.com customers:
Terms of Service Update:
In the unfortunate circumstance when our website is hacked and all of our customers' login information and credit card information is stolen... it's not our fault.
Thanks for using Amazon.com!
"With patience a ruler may be persuaded, and a soft tongue will break a bone."
People need to quit looking at whole numbers and think about this in real terms.
.7% of the business they do in one week.
One hour. That's all, they lost business for one hour, they're still up for many thousands (maybe millions) of other hours incurring the revenues consistently.
As for everyone who says "but it's so much money!" you're missing the point, absolutely no reasonable business anywhere is spending so much on just running their business that one hour of lost revenues is actually going to cause so much as a blip on their books.
Think of it like this, if one day to another can fluctuate 5% just through pure randomness not even counting cyclicalness, their revenues fluctuate 1.2 hours worth at random. Do you think to any company 5% less business on one day is enough to stir any real bother? That's
Suddenly losing one hour of business among the countless in uptime they've had doesn't seem like such a big deal, if you want to report "wow amazing amazon makes X hourly" great maybe it's interesting to somebody, but "amazing amazon was down for an hour and lost X" is just dumb because one hours loss doesn't mean anything in real terms to the business or it's shareholders.
Rain in dc
Good luck with that. First you have to pack it up in the ORIGINAL packaging, then fill out a Return For Credit form, and then wait at least 10 days for processing...
THEN maybe you can claim your credit.
It's supposed to be completely automatic, but actually you have to press this button.
I dont see why this is even worth mentioning. Its a website, a website like EVERYTHING ELSE doesnt work 100% of the time. So amazon is down for a bit? Big deal, you come back in a little while and make your purchase there.
If amazon was down for days on end, or constantly going down over a long period of time it would be worth mentioning then.
I highly doubt they lost 5 million dollars. THats the stupidest comment Ive seen today. Sure they lost it if that was a static number. It just means the hour following the outage they will make 10 million because people will come back and buy what they original intended to. Its not lost money, its slightly delayed money and that is it.
That would be because they spent a bunch of money building new facilities for their "all shipping is overnight shipping" push.
If you look at how much profit they made before investments in facilities, you'd realize they are "barely breaking even" in the same sense that buying saleable inventory makes you "broke".
Amazon.com averages $100,000 per minute in sales according to the Seattle Times.
OTOH, while the site was down, they still had they're overhead - the meter was running to keep the business going. For an operation that size, it wouldn't surprise me if it cost a few million corporate wide. Don't forget, while those orders weren't coming in, folks didn't have the work load that their position entails. Or another way, they're productivity would decline because of less or lack of work. I doubt there were guys sitting on their asses in the distribution centers; then again, if they're supposed be moving X packages per minute and were only doing Y, then their particular profitability drops. And if they have to move Z amount of packages to break even and Y At the end of the year, though, this will amount to nothing because the folks who couldn't order their stuff just waited and came back.
Aside from impulse shoppers, I don't think there would be much sales that were lost permanently.
tl;dr - this will have very little effect on Amazon's profitability.
No, get off our Internet. Next, you ingrates are going to demanding absurd things like the metric system.
No.
"Amazon.com's latest earnings report showed that the company makes about $10.8 billion per quarter, or about $118 million per day and $4.9 million per hour."
No they don't, Amazon makes barely any profit at all. They do have high (and growing) revenues though.
You can stick UTC all the way up yer arse.
I am surprised they figured it out so quickly considering the fact they claim they don't know where most of their items come from. Good luck getting an RMA on that faulty equipment Amazon since you claim most of what is stocked comes from a mystery location with no return policy.
You're suggesting that amazon, with 20b in revenue last quarter, would have made 10b if they had not invested anything in equipment/facilities? A 50% profit margin?
You can't be that stupid.
something and the web site I usually shop at is temporarily down rather than trying again later I go elsewhere or don't buy it at all.
Oh shiny...
Looks more like 15 minutes.
calling bs on the hackers who claimed responsibility.
http://gizmodo.com/5980618/amazon-is-down
No, he's saying that if they didn't invest their net income would not have decreased 'for now', but that because they invested in their future that net incomes may be even larger in the future, risk of the unknown aside.
Conversely you can't have been that stupid to miss what he said.
I see you are thread-challenged. maybe you should read the post he replied to first: http://slashdot.org/comments.pl?sid=3424409&cid=42756337
If you have a brick and mortar store, the electricity might fail. Or there might be a gas leak. Or a protest march. Sites go down, shops have to close, shit happens.
So they made 5 million less revenue on yearly revenue of 10 billion. Big whoop.
It is amazing if you are a web developer how many websites insist on 100% uptime when the costs to truly guarantee that are astronomical and the benefit negligible. If you are willing to tolerate the risk of say a days downtime per year, you can save a LOT of money. And that is just risk, 99.999% of the time single server webshops run perfectly fine for years.
Same with scheduled downtime, I have had to send huge bills to webshops making a few thousand a year because they insisted on no downtime during upgrades. Fine, I can do it. But when I look in the server logs and order history and see that before 8 in the morning not a single order has ever been made, I could also have done the upgrade at a fraction of the cost at 7 in the morning. But no, upgrade must happen at 2 because a single customer might suddenly decide to order. For a B2B site...
Webshops are a busy industry but you are dealing with people who often just can't do a cost/benefit analysis. Here is a hint. Your hosting costs are costs reducing your profit and revenue isn't profit. If you serve a market of one small European country, you don't need 24/7 uptime and while you might want your site to fast loading because Google says slow sites loose business, have a 8 core xeon with 64gb memory is a bit excessive for a site doing maybe a handful of orders a day.
So Amazon was down for an hour. They lost some income from buyers who either had another think or went somewhere else. The majority might simply have waited it out. There is no need to panic, this is NOT the end of the world. If you are thinking about ever running a business and you are worried about such a trivial matter, you will have a heart attack before you a thirty.
And the funny thing is that those who worry about trivial downtimes, consider customer support as totally unimportant. One hour downtime drives your customers away. Lousy support clearly doesn't...
Take for instance Amazon's lousy customer support and lack of decent payment options in Europe. they still don't support anything but credit cards and don't even have a presence in many countries and willfully attempt to ignore local consumer laws.
But ooh, hour down time. Yeah, that is the deal breaker!
Relax.
It might have cost them $5M in sales, but their profit on that is less than 2%, or less than $100,000. And even that assumes all those sales are lost and not simply delayed.
They must use EC2.
mov ah, 4ch
int 21h
Oh, right, THAT Amazon. Thanks for avoiding any potential confusion with...well, nobody.
To have a right to do a thing is not at all the same as to be right in doing it
XKCD