Organisations across the Asia-Pacific (APAC) region are facing significant financial losses due to downtime incidents, with an average annual cost of US$300m, according to new research by Splunk and Oxford Economics. The study reveals that lost revenue alone accounts for US$104m of this impact, as businesses grapple with the challenges posed by AI risks and cloud complexity.
The research comes at a crucial time for Singapore, following the AI Verify Foundation’s initiative to enhance trusted AI deployment. Despite the rapid adoption of AI, many businesses express concerns about operational risks, including outages and unpredictable AI behaviour. Notably, 75.6% of surveyed organisations report that rising customer expectations for uninterrupted digital services have heightened the priority of reducing downtime.
Human error remains a prevalent cause of downtime, even as AI adoption increases. Alarmingly, 41.1% of organisations acknowledge that their AI usage has elevated the risk of downtime. Kamal Hathi, SVP and GM of Splunk, emphasised, “Downtime is inevitable; prolonged disruption is not. The most resilient organisations align technology with business outcomes.”
The study also highlights the broader impact of downtime, with financial and market erosion, customer churn, and escalating ransomware costs being significant concerns. The average cost of downtime has reached US$15,000 per minute, and organisations experience an average 3.4% drop in stock price following such incidents.
As businesses increasingly rely on AI for resilience, the need for robust governance and human oversight becomes paramount. The report underscores the importance of end-to-end visibility and proactive investment strategies to mitigate downtime risks.
