The world’s leading providers of cloud services suffered 1,190 performance disruptions across their cloud landscape in 2022, of which 492 were classified as critical, according to a report from Parametrix.
Businesses were affected by limited access to cloud storage and the cloud-native services provided by Amazon Web Services, Microsoft Azure, and Google Cloud Platform, which together control more than two-thirds of the global cloud market.
The report, Managing Cloud Outage Risk: Cloud Downtime in 2022, found that one-third of events impacted US cloud regions, while the balance of the critical events was split roughly between Europe, Asia, and the rest of the world.
It also included the findings of a Parametrix survey of business decision-makers, of which 82% said their organisation or product is dependent on the availability of the cloud.
23% estimated downtime costs their organisation $500,000 or more per hour, while 60% said they are “very concerned” about cloud downtime.
Further, 31% said eight hours of cloud downtime during business hours would be catastrophic, while 36% stated that eight hours of cloud downtime would be a non-recoverable, uninsured loss.
Yonatan Hatzor, co-founder and CEO of Parametrix, commented, “Downtime is an inevitable reality for almost every business.
“As companies increasingly rely on cloud providers for day-to-day operations, they are exposed to the real risk of downtime.
“Our powerful combination of technology and skills allows us to deliver solutions to this leading risk of the digital age, which conventional cyber insurance policies do not cover effectively.”
Parametrix recently announced that it is working to bring insurance-linked securities transactions to market which would protect ceding re/insurers against sustained cloud outage, to which many are exposed through their cyber portfolios.
At the time, the leading provider of cloud downtime insurance suggested that a “Cloud-in-a-Box” transaction would employ a concrete, predetermined, and easily observed parametric trigger to transfer the outage of a specific cloud service or groups of services provided by a vendor in a pre-defined cloud service region.
In January, the firm monitored an outage of Microsoft Azure, which affected thousands of businesses and tens of thousands of users.
According to the proprietary Parametrix Cloud Monitoring System, which immediately identified the outage, the incident lasted for approximately 2 hours and 24 minutes.
Parametrix is a Managing General Agent and Lloyd’s Coverholder that underwrites parametric insurance against outages of the cloud, CDNs, or e-commerce platforms. It is backed by major A-rated global insurers and operates from offices in New York, Tel Aviv, London, and Munich.
