How Much Did That Internet Outage Cost Us?

It’s not clear yet whether today’s territories-wide phone and internet outage was thanks to a misdirected backhoe or a prisoner tunnelling out of an Edmonton jail and straight through a fibre line (more likely, right?). What we do know is that for nearly three hours this morning it seemed like a nuclear war had taken out the south, and we had been stuck in a lonely, communications-less world.

Perhaps that’s an exaggeration. But for a company like EDGE, which works almost exclusively online, it brought things to a grinding halt. And it got us wondering: how much of an economic impact does an event like this have on Yellowknife, with its increasing number of home-based and online businesses?

The numbers are fairly scarce and the math is admittedly tentative, but our best-guesstimate places the economic cost of the three-hour outage in Yellowknife at just over $400,000.

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That’s based on our 2015 population numbers, showing 16,457 people over the age of 15 in Yellowknife; the 2014 workforce participation rate of 79.4 percent; the average hourly wage of $31; and Statistics Canada’s 2012 data on internet usage at work (the most recent) which suggests 33.2 percent of people use the internet at work. Combined together, and taken with a boulder-sized grain of salt, this suggests Yellowknife workers were roughly $134,500 less productive for each hour of internet outage, or $403,500 (give or take a bit) for the duration of the outage.  

It’s likely that in 2016, the number of people using the internet at work is significantly higher than 33.2 percent in 2012. To balance that out however, our calculation assumes that no productive work can be done by internet-using workers when their internet is down — which seems unlikely. And of course, not all costs to YK businesses can be calculated by looking at hourly wages.

The long and the short of it is that no internet in our increasingly connected age has a significant impact on work, perhaps even in the $134,500/hour ballpark for our little Northern city. Whatever the exact number is, it raises the spectre of not insignificant economic disruption if the information pipelines that keep us connected to the rest of the world don’t have sufficient redundancy built in. Right now, our internet corridors are too much like our transportation corridors — with one bridge over the Deh Cho. Pity Yellowknife’s online businesses (and Netflix addicts) should our information bridge ever go down for longer than a few hours.

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