Facebook Site Outage, a Last Straw

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By Douglas A. McIntyre Published
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“Earlier today, some users briefly experienced issues loading the site. The issues have since been resolved and everyone should now have access to Facebook,” company spokesman Michael Kirkland told Reuters. It is hard to imagine that Facebook’s luck could get much worse, but it did.

On the back of a bungled IPO, a sharp drop in the firm’s share price, and legal suits and investigations of all kinds, Facebook (NASDAQ: FB) maintains its most tremendous strength. More than 900 million members can get onto the site at one time or another to “talk” with their friends and family, and anyone else who will listen. The site is available 24 hours a day, which is how much time some people spend on it. Facebook is worth $75 billion now, based on its sales, still a tremendous amount, because of the promise those people hold for advertisers and e-commerce companies.

It is not unusual for large sites to go down. The problem plagued Twitter two years ago. Twitter fixed that problem before it alienated a lot of users. But its shows that huge online businesses are not immune from outage problems.

Facebook faces at least two challenges in keeping its site up all of the time. There is only a remote chance either would happen. Facebook’s track record for being permanently on is extraordinary, given the load of users it handles. But among the risk factors in its document in SEC filings for its IPO is this:

Computer malware, viruses, and computer hacking and phishing attacks have become more prevalent in our industry, have occurred on our systems in the past, and may occur on our systems in the future. Because of our prominence, we believe that we are a particularly attractive target for such attacks.

One, less sinister challenge is that Facebook’s own internal systems could falter because of software or server problems. Like Google (NASDAQ: GOOG) and other sites that serve hundreds of millions of people, Facebook has a bullet-proof IT structure, unless some small problem in its systems causes a breakdown.

The greater risk to Facebook are the sophisticated hackers that have popped up around the world. Members of these groups sometimes act in concert. They become more adroit at their work each day. Chinese servers can attack sites in the United States, some of them run by the government and big businesses. Iran’s Internet infrastructure has been hit by two big viruses. One, called Stuxnet, did its damage two years ago. A new one, called Flame, has struck more recently. Flame has 650,000 lines of code, according to security experts. It can cut network traffic and co-opt passwords.

Facebook’s greatest strength, which is its ability to serve all of its customers all of the time, could be undermined in a minute.

Douglas A. McIntyre

Photo of Douglas A. McIntyre
About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.

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