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Shares of Fastly, the Internet infrastructure company, which on Tuesday toppled thousands of popular websites around the world, rose 11% after the outage.
Quickly, a content delivery technology provider designed to speed up online transmission and upload speed, had added more than $ 600 million to its market capitalization at the close of trading on Tuesday in New York, valuing the company little known at $ 6.5 billion.
San Francisco-based Fastly apologized for an “undiscovered software error” that caused an error interruption which affects 85% of your network. The error was triggered when a lone Fastly client made a seemingly routine change in the configuration of their systems, Fastly said.
“While there were specific conditions that caused this disruption, we should have anticipated it,” said Nick Rockwell, Fastly’s senior vice president of engineering and infrastructure.
While its shares initially fell as news of the widespread disruption to media, broadcast services and e-commerce platforms occurred, the strong recovery suggests that investors may have been impressed by how quickly Fastly solved the problem.
He quickly said in a blog post posted Tuesday afternoon that 95% of his network was “running normally” 49 minutes after he discovered the problem.
“We detected the outage within a minute, then identified and isolated the cause and turned off the settings,” Rockwell said. “This disruption was broad and severe, and we truly feel the impact they have on our customers and on everyone who trusts them.”
The strong response from investors may also reflect the number of reputable companies that the cut revealed as Fastly customers, including Twitch, Spotify, Stripe and Shopify owned by Amazon, as well as media companies such as the BBC , The New York Times, CNN and the Financial Times.
Businesses use content delivery networks to store data on dozens of server farms splashed around the world, reducing business bandwidth requirements and accelerating flows and downloads for consumers.
Fastly was founded a decade ago and the company has more than doubled in value since it went public in May 2019.
Its revenue grew 45% last year to $ 291 million, with more than 2,000 corporate customers, but net loss widened 86% to $ 95.9 million in 2020.
Investors ’positive response to Tuesday’s events could wane if Fastly is forced to offer costly compensation to most of its customers. Subscribers to your “Gold” support plan have a 100% uptime guaranteed.
“Any failure in the level of service could harm our business,” Fastly stated in a recent regulatory document that presented potential risks to its business, which also noted a “platform disruption” prior to January 2021.
“If we are unable to meet established service level commitments, including non-compliance with the uptime and delivery time requirements set forth in our agreements with our customers, in the past we may be contractually required to provide credit to affected customers. service that could significantly affect our revenue, “Fastly said in a presentation last month.
After similar issues affecting Amazon Web Services and Cloudflare dropped a large number of websites last year, Tuesday’s disruption has once again revealed how many of the world’s most popular online services rely on a relatively small number. of cloud computing platforms.
“Internet infrastructure is an incredibly complex network of dependencies and reliability is no coincidence,” said Andy Champagne, vice president of Akamai, one of Fastly’s rivals. “It takes a combination of technology and people who work with rigorous precision to ensure it works like a well-oiled machine.”
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