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A Look at the High Cost of Outdated Technology

A penny saved is a penny earned. Small to midsize businesses (SMBs) often use this time-worn phrase as the rationale for decisions to limit spending on technology. When budgets are tight and expertise is limited, it seems easier and cheaper just to muddle along with existing IT systems.

Additionally, organizations may keep an old server that’s needed to run one piece of old software.

However, numerous studies find that holding on to obsolete or unsupported technology can result in significant costs from downtime, lost productivity and diminished security. It can also damage an organization’s reputation with customers, and create high levels of frustration, dissatisfaction and disengagement among employees.

Here’s a deeper look at some of the factors that contribute to the high cost of outdated technology.

Security Risks

Unpatched and outdated systems are a primary cause of cyberattacks. The U.S. Computer Emergency Readiness Team estimates that unpatched systems play a role in about 85 percent of all successful network intrusions. When systems become outdated, vendors no longer issue patches and updates, making it impossible to protect these systems against attack. Additionally, older systems may not be able to support the latest operating systems and software, and may not have adequate logging capabilities, making it difficult to spot attacks in progress.

With the Internet of Things (IoT), those issues extend to all types of devices. For example, a recent study by Armis found 20 percent of connected medical devices are running unsupported operating systems.

Maintenance Costs

Older technology comes with increased maintenance costs. As vendor support is phased out and replacement equipment becomes scarce, organizations must pay more for a maintenance contract that includes anything more than bare-bones support and service options. With very outdated equipment, spare parts are no longer available from the manufacturer, forcing organizations to scour gray market sources such as eBay.

The risk of equipment failure also rises as IT equipment ages. As with all mechanical devices, business technology has moving parts that wear out. A server crash can result in downtime costs of thousands of dollars per hour, not including the cost of data recovery processes. If the data can’t be recovered, that’s a potential business-ending event.

Lost Productivity

According to a recent survey conducted by Skynova, employees waste more than 80 hours each year due to outdated technology. The finance industry suffers most, losing 103 hours of productivity annually. Equipment downtime and troubleshooting contribute to productivity losses, along with the need to perform repetitive tasks that could easily be automated.

In addition to lost time and money, outdated technology causes employees to skirt organizational policies. Workers often download applications, subscribe to cloud services and use their own devices without their IT department’s knowledge or approval. This can be attributed to an employee’s desire to adopt modern technologies at a faster pace than their organization. However, unauthorized technology can cause IT headaches and bring grave security threats.

Reputational Damage

Outdated technology can tarnish an organization’s brand. When organizations use equipment or free, cloud-based email services, many consumers will assume they are not professional and lack credibility. Additionally, the poor performance, downtime and security risks associated with outdated technology can contribute to customer churn.


Money is always an important consideration, and IT budgets are likely to remain tight for a while. Although delaying upgrades may conserve capital, there are risks with such a strategy. SMBs with computers and servers too old to efficiently handle today’s workload or protect against the latest security threats may find that failure to upgrade is even more costly in the long run.

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