It's one thing when Amazon, Google and Microsoft go down. It's quite another when the Nasdaq stock market goes dark.
Following on the heels of the Microsoft Outlook and Google's total five-minute blackout, Amazon also suffered a 25-minute outage on Monday -- an outage that could cost the e-commerce giant millions of dollars in lost . But what happened at Nasdaq was potentially far more costly.
On Thursday, a three-hour blackout of the world's second-largest stock exchange brought trading to an abrupt stop. According to USA Today, it paralyzed trading in stocks with a combined value of more than $5.9 trillion. Much like Amazon, Google and Microsoft, the outage is still unexplained.
SEC Means Serious Business
Mary Jo White, chair of the U.S. Securities and Exchange Commission, responded swiftly to the outage. She noted that the "continuous and orderly functioning of the securities markets is critically important to the health of our financial system and the confidence of investors." She went on to say that Thursday's interruption in trading, while resolved before the end of the day, was "serious."
"The commission is determined to enhance the safeguards necessary for strong market systems," White said. "As one step, I will work to advance rules that the commission proposed earlier this year regarding new standards for the trading and other systems that are central to the integrity of our markets. I also will shortly convene a meeting of the leaders of the exchanges and other major market participants to accelerate ongoing efforts to further strengthen our markets."
We turned to Martin Mackay, CEO of NeverFail, a global IT continuity management company, to get his thoughts on the shut down. He told us the financial risks posed by an outage are almost hard to even fathom.
"Businesses -- like the New York Stock Exchange, the London Stock Exchange and Nasdaq, and transaction clearing houses like Visa, MasterCard or other similar networks -- take extraordinary measures to build redundant systems and checks to avoid downtime," he said. "But no systems are fully immune."
As he sees it, the Nasdaq outage, along with recent outages at Amazon, Microsoft and the Apple Developer Network, are stark reminders that we're more reliant on IT than ever, and that the interdependencies between systems can cause a seemingly innocuous technical glitch to turn into a staggeringly expensive outage.
"Downtime at big companies makes news, but every company is at risk. Redundant infrastructure is often necessary to avoid outages -- table stakes -- but it's also important to identify risks before they become a problem, and make sure continuity plans will work should a failure occur," Mackay said.
"We should all be working to identify the dependencies that our businesses rely on to run. Having this information and keeping it up to date helps us know where to apply strict change controls, and where to place our bets for business continuity investments," he added.