When Apple's iTunes Store and App Store were taken out of commission on Wednesday thanks to a DNS issue, iPhone, iPad and Mac owners couldn't purchase apps, songs, movies or books. It took Apple 12 hours to get their systems up and running again, costing the company about US$25 million in lost sales.
App Store downtime cost Apple $25 million, developers $13.5 million
Apple customers weren't able to connect to the iTunes Store, App Store, Mac App Store, iBookstore, or iCloud for about half of Wednesday thanks to the internal problem. Apple commented on the issue after several hours of downtime saying,
The cause was an internal DNS error at Apple. We're working to make all of the services available to customers as soon as possible, and we thank everyone for their patience.
During the unintentional 12-hour blackout, customers couldn't purchase apps, books, or other content, and that equates to lost money. Based on the $18.5 billion Apple brought in from those services last year, that breaks down to about $50 million a day. At half a day, that's $25 million—assuming sales haven't increased at all this year, which they likely have.
Missing out on $25 million in sales doesn't sound like much for the most valuable company in the world, but for app developers who make their living from those sales, yesterday's outage had to hurt at least a little. Last year, Apple paid out $10 billion to app developers, or about $27 million a day, leaving app makers short $13.5 million during the App Store's down time.
Since iPhone and iPad apps are available only through the App Store, and many Mac developers offer their products only through the Mac App Store, any down time has to hurt. Some users wanting to buy apps will try again now that Apple's services are back up and running, but developers won't be able to make up all of the sales they lost yesterday.
Considering this is the primary source of revenue for many developers, keeping the App Store and Mac App Store running reliably is a pretty big deal. Hopefully Apple has taken measures to avoid extended down time in the future.