In 2020, organizations everywhere began to transfer their employees to remote work, more and more people were locked at home due to quarantine. In these conditions, IT infrastructure has become on a par with such critical utilities as water, gas and electricity. Without a connection to communication networks, telecommunication services and cloud storage, many organizations simply cannot work, and consumers will be significantly limited in the ability to purchase the necessary goods, communication and entertainment. Supermarkets, broadcasters, financial service operators and many other companies have been able to continue to operate solely thanks to advanced information technology.
Online shopping – especially for essential goods – has become commonplace, and global network traffic in this segment has grown by more than a third. Streaming subscriptions are breaking records with 26 million new subscribers by the end of June. The number of users of social networks, instant messengers and video communication platforms has also grown. The most impressive results were demonstrated by the Zoom platform: revenue growth compared to 2019 was 335%. Today, almost everything in our life, from medical consultations or checking a bank account to playing sports, is subject to digital-first principles. So what will change with the transition of IT from the category of secondary services to the status of one of the key infrastructures? The implications for the tech industry are hard to overstate. The role and value of information technology for the economy and society today is obvious to everyone. While this is great news for SaaS, cloud and network service providers, it’s also a big responsibility to have a big impact.
Outages are not allowed
As soon as IT becomes a critical infrastructure, you need to ensure that resources are always available. Think about it: how often do water or electricity interruptions happen? They happen extremely rarely, every time they cause a violent public reaction and get into the main news. Can we say that the availability of IT services is at the same level? How often do you have to restart routers and applications stop responding to commands? Moreover, cyberattacks with data breaches are constantly occurring: according to some studies, up to 30,000 websites are hacked daily. If technology services are truly becoming key infrastructures, it is necessary to ensure certain service quality standards, according to which operators will be held accountable to independent regulators. Simply put, situations such as “unable to display the page” or “computer not responding” should be a thing of the past. While the tech giants may like this turnaround, it is one of the key requirements in light of how important information technology plays today in almost all aspects of our lives.
However, in addition to possible resistance from Silicon Valley, speaking about the regulation of the technology sector, there are other risks to consider. For example, when it comes to social media and search services, there is an unprecedented situation where the requirement to provide a certain level of service is put forward for services for which the consumer does not pay. On the other hand, subscription SaaS models are quite consistent with such regulation. In principle, this type of regulation already exists on the market in the form of a Service License Agreement (SLA). It is formed by the service or service provider, and after concluding an agreement with a partner or client, the supplier is obliged to comply with its terms. Considering that downtime and unavailability of resources entail significant damage to the business, customers are placing increasing demands on suppliers.
According to the Veeam 2020 Data Protection Trends Report, 95% of organizations worldwide have experienced unpredictable IT outages or failures. The average downtime was nearly 2 hours. Losses due to disruptions to mission-critical applications — which typically account for more than half of those used by an organization — are estimated to average $ 67,651 an hour. This means that in each such situation, when an organization cannot use e-mail, payment instruments, websites or mobile applications, the total damage on average exceeds $ 135,000. And although in each case, companies can claim compensation for losses, change service providers if they do not provide the proper level of service, or require unscheduled repairs to equipment that causes malfunctions, there is no one-size-fits-all solution to protect your business. One of the steps towards tighter regulation of technology and telecom companies is the formation of minimum requirements for the level of service, including limiting the maximum allowable downtime, time to restore