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Not so Fastly! Massive global internet outage followed tech stock rally.


8 June 2021

Today was the modern version of the apocalypse. We have all seen that amusing meme that did the rounds a few years ago, showing two pyramid-shaped graphs, one from the industrial revolution period, with the graph showing the problems faced by humanity at that time, with hunger, war and poverty at the thick end, and then another pyramid graph next to it with the current date at the time showing 'low battery' or 'no signal' as being the highest level of emergency.

Yes, it was intended to be tongue-in-cheek, however today, the dreaded outage that was depicted as the worst fear in all of humanity occurred. At approximately 11.00am UK time, a large number of the world's most used websites stopped working.

Amazon, Reddit, Twitch, Spotify, Shopify, BBC.com, HBO Max, Vimeo, the UK government portal gov.uk, PayPal, New York Times, CNN and eBay were among the vast number of sites that were down until around 13.45 UK time. Such a major impact on the accessibility of these and many more major sites is a big deal in today's completely internet-dependent world. A quick look at DownDetector.co.uk shows the extent to which people could not access a number of sites during the course of today.

The culprit has been identified as Fastly, a vast, New York Stock Exchange-listed cloud computing services provider which was founded in 2011 and has accelerated since then to the Silicon Valley tech giant it is today.

The company's stock rose in value by a remarkable 8.2% yesterday, primarily due to broader-market bullishness for growth stocks during the course of the day. Fastly stock's gain followed a period during which its shares have taken a severe beating in 2021, therefore yesterday's increase is something of a hollow victory, given that the firm's stock is down 42% year to date.

Fastly management said in its first-quarter earnings release that many of the strong tailwinds that helped the company in 2021 appear to be permanent, however with a faux-pas as large and high profile as the one today which took out sites that have a massive and wide-ranging audience, who knows what that will do for investor confidence. It is no longer possible to hide such embarrassing problems from a global general public whose life revolves around using the massive sites that were affected by today's outage.

“Fastly’s network has built-in redundancies and automatic failover routing to ensure optimal performance and uptime, but when a network issue does arise, we think our customers deserve clear, transparent communication so they can maintain trust in our service and our team" came the rather generic but egg-on-face statement from Fastly today.

Many commenters during the outage have drawn the conclusion that the majority of people affected were in specific locations across Europe and the United States, however those are key regions for the use of all of the affected websites. Who knows what action these large companies whose sites were down may take against Fastly for reputational damage or continuity issues? All of them are huge global giants whose reputation rides on constant accessibility, therefore it is likely that their executives would be somewhat livid right now.

Just one hour ago, Fastly stated "The issue has been identified and a fix has been applied. Customers may experience increased origin load as global services return.”

Currently Fastly shares are dropping slowly again. What if confidence wanes, contracts get terminated or internet firms seek legal retribution? High profile Bronx cheers such as this are not what a company in Fastly's precarious position needs.

Risk warning: Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 74.5% of retail investor accounts lose money when spread betting or trading CFDs with ETX. You should consider whether you understand how spread bets or CFDs work and whether you can afford to take the high risk of losing your money.
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