The Implications of the AWS Outage

A glitch in one of Amazon’s database disrupted life for many people on October 20th. A faulty update to Amazon’s Domain Name System caused it to give incorrect information to an Amazon Web Services database called DynamoDB, disrupting information in Amazon’s supply chain, delivery GPS system, and many internet sites that use the database for information.

Affected Sectors

As the day went on, this outage led to a delay in more than 4,000 sites, disruption of news outlets, and delays in various financial transactions. This displays how fragile these cloud databases are considering how critical they are in the daily activities of companies. Some of the sectors that this outage affected were educational services, financial activities, social media, e-commerce, and much more. I myself was affected due to this outage, with the educational platform Canvas being down for most of the day.

This outage had major financial implications as well. Investors were unable to close trades, platforms like Robinhood went offline, and small companies that depended on the service for supply chain activities, lost out on revenue from a multitude of orders. While there isn't a specific number available, there is a high likelihood that affected companies lost millions of dollars due to this.

The Future of Cloud-Based Services

I think that this outage was a major wake-up call for the vast majority of companies that rely on a single stream of cloud computing or cloud services in general. Many of these companies had not evaluated the possibility of an outage due to Amazon's established status. However, with this outage, many companies will definitely be looking to diversify their cloud services to mitigate future risk. Companies that took the precautions at an earlier stage by diversifying these services, or used their own data centers, were still able to function at a much larger rate during the outage.

This emerging need for varied cloud services can have both plus and minuses. On the plus side, this is an opportunity for small tech/cloud computing companies to grow at a fast pace. Companies will look to create backups to their main cloud service, increasing the demand for smaller tech companies to act as a failsafe. However, some companies may altogether move away from AWS or other services they deem "unreliable", lowering the number of consumers for some mainstream cloud computing services.

While AWS will still remain one of the most used cloud computing services, I believe that this new wake up call has the opportunity to grow the economy and allow for the rise in many smaller startups as time goes on.