Myth #3 – My cloud provider/vendor will take care of me
Service level agreements (SLA) are paid out service credits tied to the cost of the affected service, not cash refunds. They generally start at 10% of service charges, never resulting losses. Your enterprise will literally get pennies back on dollars lost.
The July 2024 CloudStrike outage cost CloudStrike around $75M + $60M they paid out in service credits. This pales an order of magnitude when compared to just one customer, Delta Airlines, which lost $500M net. Parametrix Insurance’s detailed analysis estimates the total direct financial loss facing the US Fortune 500 companies is $5.4B. CloudStrike literally paid pennies on the dollar for their error, so an enterprise’s reliance on a vendor must be managed knowing this reality.
The 11/18/2025 Cloudflare outage, with its 20% hold on global web traffic, equally affected hundreds of millions of accounts, including major systems like X (Twitter), OpenAI/ChatGPT, Google’s Gemini, Perplexity AI, Spotify, Canva and even all three cloud providers. This heightens how a single vendor/platform dependency is a real threat to business continuity.
