‘Severe’ network outages costing $160bn globally

Research from Cisco has found that even though most outages stem from congestion, cyber attacks and misconfiguration, IT leaders believe the right infrastructure can protect performance and unlock future value.

The survey was conducted across 30 markets in December 2024 by Sandpiper Research & Insights, on Cisco’s behalf. It took the views of 8,065 global senior IT and business leaders responsible for networking strategy and infrastructure at organisations with 250 or more employees.

Cisco believes the study found six signals indicating that an architectural shift was underway and driving the view that the modern network must be smarter, more secure and more adaptive. Namely, the network has become a strategic priority, secure networking is mission-critical, artificial intelligence (AI) intensifies demand for resilient networks, IT leaders are looking to AI to grow revenue, AI is reshaping infrastructure, and IT leaders want to make networks smarter.

The study highlighted how IT leaders are already delivering financial value from today’s networks – largely by improving customer experiences (55%), boosting efficiency (52%) and enabling innovation (51%). But Cisco warned that much of that value is at risk if it comes from infrastructure that is not designed for AI or real-time scale.

To unlock the full growth and savings they expect, IT leaders in the survey identified critical gaps they must close, such as siloed or partially integrated systems (58%), incomplete deployments (51%) and reliance on manual oversight (48%). Smarter, more secure, more adaptive networks are the business case for investment.

Nearly nine in 10 (89%) said improved networks would directly drive revenue, and almost everyone (93%) expected meaningful cost savings – driven by smarter operations, fewer outages and lower energy use.

Drilling deeper, the study noted that the network has powered every wave of digital transformation so far, and to support AI, internet of things (IoT) and the cloud at scale, the network is foundational. The surveyed IT leaders were found to be aligning investment with this reality.

As many as 94% said AI, IoT and cloud computing would have the greatest impact on their network in the next two years, with 62% saying it would be down to AI alone. In addition, 97% said a modernised network was critical to rolling out AI, IoT and the cloud, while 91% were planning to increase the share of IT budget allocated to networking.

With both AI for networking and networking for AI proliferating, Cisco noted that while AI needs fast, uninterrupted access to data, many networks actually can’t keep up. It added that leaders know outages cost more than downtime – they impact revenue, productivity and growth. AI-native, autonomous networks were seen as essential to future growth, but only 41% had deployed intelligent capabilities such as segmentation, visibility and control.

Just more than three-quarters of those surveyed (77%) said they had faced major outages in the past two years. The leading causes of disruption were found to be congestion, cyber attacks, software or configuration errors. More than half (52%) said revenue was the business area most impacted by disruptions, adding up to $160bn globally from just one severe disruption per business, per year.

Cisco observed that as cyber threats grow more sophisticated, the network acts as the first line of defence to help security teams address the emerging AI-driven risks more effectively. The survey revealed that 98% viewed secure networking as important to operations and growth, and 61% saw it as critical. In addition, 94% believed a modernised network would enhance cyber security.

Assessing the trends revealed in the study, Chintan Patel, chief technology officer and vice-president of solutions engineering at Cisco EMEA, said AI was changing everything and infrastructure was at the heart of this reinvention.

“The network has powered every wave of digital transformation, accelerating the convergence of IoT, cloud, hybrid work and defending against rising security threats,” he said. “IT leaders know the network they build today will shape the business they become tomorrow. Those who act now will be the ones who lead in the AI era.”