Net Disaster Could Paralyze Economy, Study Warns

By Mel Duvall  |  Posted 2006-06-23 Print this article Print

The U.S. economy could be paralyzed in the event of a major disruption of the Internet, an influential group of chief executives said in a report issued on Friday.

America's Internet and cyber infrastructure have become such a critical backbone for the exchange of information, that any major disruption could have significant economic and security repercussions. The report, issued on June 23 by the Business Roundtable, a group comprised of chief executives of 160 of the country's largest companies, calls on the federal government to set up response plans and establish clear lines of responsibility.

"If our nation is hit by a cyber [Hurricane] Katrina that wipes our large parts of the Internet, there is no coordinated plan in place to restart and restore the Internet," John Castellani, president of the organization, said in the report. "A cyber disaster could have immediate and nationwide consequences to our nation's security and economy."

The organization noted that voice calling over the Internet, an increasingly important line of communication, would be disrupted in such as event, and the outage could also have severe repercussions for banks, hospitals, and transportation networks. Members of the Business Roundtable include chief executives of some of the nation's most influential companies, including State Farm Insurance, Dow Chemical, IBM and FedEx.

The report identified three key gaps in response plans to restore the Internet:

  • Inadequate Early Warning System: The U.S. lacks an early warning system to identify potential Internet attacks or to determine if disruptions are spreading rapidly.

  • Unclear and Overlapping Responsibilities: Public and private organizations that would oversee recovery of the Internet have unclear responsibilities, which could result in too many institutions with little interaction or coordination.

  • Insufficient Resources: Organizations charged with restoring the Internet need to have the resources and support to accomplish the effort. The report noted that little of the National Cyber Security Division's funding is targeted towards cyber recovery.

    In addition to asking the federal government to establish an emergency action plan, the 21-page report, "Essential Steps Toward Strengthening America's Cyber Terrorism Preparedness," offers several recommendations for the private sector. It urges companies to designate a point person for cyber recovery, update their strategic plans to prepare for a widespread Internet outage, and to set priorities for restoring Internet service and communications.

    In one specific recommendation, the Roundtable urged the creation of a federally-funded panel of experts who would assist in developing plans for restoring Internet services in the event of a disaster.

    "We need a national response to this challenge, not separate business and government responses–and that means better collaboration," Castellani said.

    The full report is available on the Business Roundtable's site, here: www.businessroundtable.org/pdf/20060622002CyberReconFinal6106.pdf

    Contributing Editor
    Mel Duvall is a veteran business and technology journalist, having written for a variety of daily newspapers and magazines for 17 years. Most recently he was the Business Commerce Editor for Interactive Week, and previously served as a senior business writer for The Financial Post.


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