Indian firms face $76M median annual cost from outages 2025: New Relic

New Relic’s 2025 Observability Forecast, based on a survey of 1,700 IT and engineering professionals across 23 countries and 11 industries, finds that Indian organisations incur a median $76 million (USD) per year from high-impact IT outages. Globally, the report places the median cost of a high-impact outage at $2 million per hour (roughly $33,333 per minute).

The survey data point to frequent disruptions in India: 39% of organisations report at least one high-business-impact outage per week, 10% see outages daily, and 3% experience them multiple times per day. Nearly half of respondents (45%) estimate those disruptions cost between $1–3 million USD per hour.

Artificial intelligence is driving observability demand in India. The report shows that the use of observability platforms’ AI monitoring capabilities rose to 73% in 2025, up from 57% in 2024, and above the Asia Pacific average reported in the study. At the same time, organisations are taking steps to reduce tool sprawl: the median number of observability tools used by Indian organisations fell from six in 2024 to four in 2025, while the report records a 27% global reduction in average tool count between 2023 and 2025.

Fragmentation and complexity remain major barriers. 44% of respondents cite a complex tech stack as their top challenge (a nine-point increase from 2024), 33% point to excess monitoring tools and siloed data, and 29% identify internal resistance to change. Despite these frictions, respondents report measurable returns from observability investments: 42% report a 2–3x ROI and 51% report ROI in the 2–5x range. Collaboration across teams is also a frequently cited outcome, with 59% of Indian respondents saying observability improves cross-team decisions about the software stack.

“The findings of this year’s Observability Forecast point toward two clear themes for Indian organisations: AI-strengthened observability investment is a key priority, and outages are too frequent and costly,” said New Relic Senior Vice President and General Manager Asia Pacific, Rob Newell. “While most Indian organisations understand the benefits of embracing AI, many are also still choosing to accept the multimillion-dollar cost associated with outages and tool sprawl. The solution is clear: companies that embrace intelligent observability across their entire technology stack experience less downtime, fewer critical outages, and high ROI, enabling them to achieve their core business goals.”

The data underline a narrow set of priorities for reducing outage risk and realising observability ROI:

• Prioritise AI observability: extend telemetry to AI components (inputs/outputs, model performance, decision pathways) so degradation is visible.
• Consolidate telemetry: standardise schemas and reduce redundant tools to speed investigation and remove data siloes.
• Treat third-party and network dependencies as risk items — define runbooks and automated detection for provider failures.
• Integrate observability into release processes: require pre-release observability checks and automate mitigation where metrics deteriorate.
• Measure outcomes that matter: track outage cost, mean time to detect and to resolve, alongside observability ROI to justify investment.

Address organisational resistance by combining governance, training, and incentives, so that observability becomes a shared responsibility.

New Relic partnered with Enterprise Technology Research (ETR) to survey 1,700 IT and engineering respondents in April–May 2025 across 23 countries and 11 industries. Respondent roles were 65% practitioners, 24% management, and 11% executives.