AWS Outage: Are Enterprises Overestimating Cloud Reliability?

October 2025

Telecoms & Connectivity

Sam Barker

VP of Telecoms Market Research

On October 20th, 2025, Amazon Web Services (AWS) experienced a substantial outage of its services in the US, with global impacts. The outage, caused by a domain name system (DNS) resolution failure that impacted a key database service, resulted in a cascading effect on AWS services. In turn, this led to many services that rely on AWS to also suffer outages; impacting consumers of various services including Disney+, Fortnite, HBO Max, Robinhood, Roblox, Slack, Venmo, and Zoom.

Estimated User Base for Select Service Providers Impacted by AWS Outage (m)

Source: Juniper Research

While AWS resolved the root cause of the issue within three hours, there were substantial impacts on various enterprises that leverage AWS. Despite the disruption, Amazon’s stock remained relatively stable; suggesting continued investor confidence in the company’s long-term market leadership. However, the incident could accelerate demand for multi-cloud orchestration tools, edge computing, and services that increase the overall resilience of cloud services. Overall, we expect the outage to initiate enterprises to explore new solutions or business models to increase the uptime of their services.

Is There an Overreliance on One Provider for Cloud Services?

The short answer is yes, we believe that there is an overreliance on many cloud services, notably AWS — which Juniper Research estimates to have a global market share of over 30%. As a company that has such a noteworthy presence in the market, it attracts the highest spending enterprises through significant degrees of redundancy within their operations to avoid scenarios like this. However, as is evident, no service is perfectly redundant, especially as the geographical reach of cloud services offered increases the complexity of network architectures. The larger the cloud service becomes, there is more within the service to fail, and a larger chance for cascading failures.

While AWS offers service credits for downtime, it does not cover the full operational and reputational costs. The event serves as a reminder that even leading cloud providers are not immune to large-scale disruptions.

Lessons are to be learned from this outage. Enterprises must not believe that services from AWS, and other leading providers such as Google and Microsoft, can be wholly relied upon, especially for enterprises that operate across multiple regions. The impacts of a failed DNS resolution must lead enterprises to explore multi-cloud strategies to increase redundancy and avoid vendor lock-in. Additionally, we recommend that enterprises implement their own monitoring software and not rely on the services provided by cloud providers.

The Financial Impact of AWS’s Outage

The financial impact of the outage is difficult to quantify at this stage, but we believe it will be significant. Many fintech services, such as Robinhood and Venmo, suffered downtime on their own platforms, which will likely lead to time spent on chargeback and dispute resolution, plus indirect costs of the outage. Similarly, digital platforms providers such as Disney+ and HBO Max suffered service interruptions; albeit for a small amount of downtime.

Aside from direct revenue loss from downtime, such as missed transactions and halted services, several indirect losses have resulted from this outage:

• Lost productivity for users of services such as Zoom or Slack. Many other enterprises rely on this for internal and external communication. This causes delays to AWS clients.
• Disrupted operations caused by the outage can also cause indirect costs through lost time. Key examples of this are enterprises in the healthcare or aviation industries that must be considered time-sensitive industries, where efficiency is key to maintaining profit; notably as profit margins can be small.
• Loss to brand reputation if services are down for substantial periods; leading to high levels of customer dissatisfaction. Essentially, this loss is unquantifiable, given the subjectivity and changes to opinion over time.
• Customer compensation, particularly in sectors like finance, travel, and telecoms, can add further costs through required refunds and service credits — as well as the unexpected time and resource needed to complete them.

How Must the Market Respond to this Outage?

It is reported that AWS’s service level agreements (SLAs) include 99.99% uptime for virtual servers, with discounts or credits to future services if AWS fails to meet these requirements. However, it's unlikely that these agreements cover lost enterprise revenue, productivity or reputational damage. Therefore, an enterprise’s choice of cloud service provider, or providers, must consider the impacts of this kind of outage. We believe that outages of any service are inevitable at some point.

Adopting a multi-cloud strategy will increase resilience and allow enterprises to mitigate the risks, direct costs, and indirect costs associated with these outages. A multi-cloud strategy will increase resilience and minimise the risk of extended periods of service downtime by enabling fallback onto a secondary service provider.

However, a key hurdle to enterprise adoption of multi-cloud strategies is the increased cost and complexity of implementation. For example, cloud service vendors will use a different suite of APIs, and security processes and functions are not interoperable between different platforms. Not only does this strategy lead to increased spend on cloud platforms, but additional training on the additional cloud service.

Outages such as this are a clear reminder that no service provider, regardless of reputation, scale or reach, can guarantee 100% uptime or provide complete protection against service downtime. While multi-vendor strategies will increase resilience, the high cost and interoperability challenges involved will likely exclude most cloud service users from adopting this strategy.

Indeed, we believe that cloud providers should embrace this challenge; providing solutions that are interoperable with other cloud platforms, including network APIs, to maximise the value of their solutions to enterprise users. After this outage, Juniper Research expects increased interest in a multi-cloud strategy, and platforms that can reduce spend and investment into integrating with additional systems will increase their value proposition to enterprises.

As VP of Telecoms Market Research at Juniper Research, Sam produces high-quality research on telecommunications technologies and the future of digital content. His recent reports include CPaaS, Direct-to-Cell, and 5G Future Strategies. Sam has been interviewed by leading media outlets, including the BBC and Wall Street Journal, and is a regular contributor to messaging conferences and telecommunications industry events.