A major outage at Amazon Web Services (AWS) today (20 October) has caused widespread disruption across the digital economy, with online retailers among those affected. From ecommerce giants to payment platforms and customer service tools, the outage has exposed the critical dependency many businesses have on a single cloud provider.
AWS is the dominant player in retail cloud services, offering infrastructure, AI, and analytics specifically tailored for retail operations. Following the outage, Amazon’s own retail site experienced issues, alongside platforms like Canva, Venmo, Chime, and even the McDonald’s app. Airline booking systems for Delta and United were also hit, while in the UK, HMRC and several banks were among those reporting outages. These disruptions left some retailers unable to process payments, confirm orders, or communicate with customers – creating a perfect storm of failed transactions and customer frustration.
Monica Eaton, founder and CEO of Chargebacks911 and Fi911, warned that the real damage may only just be beginning. “When AWS sneezes, half the internet catches the flu,” she said. “Outages like this cause frustrated users, but also trigger a domino effect across payment flows. Failed authorisations, duplicate charges, broken confirmation pages – all of that fuels a wave of disputes that merchants will be cleaning up for weeks. And once a customer files a dispute, you are already on the back foot.”
Eaton is expecting a surge in chargebacks in the coming days, many stemming from confusion rather than fraud. “What I expect now is a spike in ‘I never got my service’ or ‘I was charged twice’ claims. Many of those won’t be fraud, just confusion. But confusion is the number one driver of chargebacks. If merchants sit back and wait for disputes to roll in, they will bleed revenue unnecessarily.”
She urged retailers to act fast: “The smart move now is to get ahead of the narrative. Run duplicate charge sweeps. Push proactive notifications. Document the outage window. Offer fast refunds. It’s cheaper to fix misunderstandings than fight losing battles.”
Wake-up call for retail
Beyond the immediate response, today’s outage is a wake-up call for the retail industry, illustrating how vital it is to build digital resilience into operations – diversifying cloud providers, stress-testing payment systems, and preparing clear customer communication protocols for emergencies. “The widespread outage that affected Amazon Web Services and major platforms across the UK is a stark reminder that our digital world is built on a surprisingly fragile foundation,” said Christian Espinosa, cybersecurity expert at Blue Goat Cyber. “Cloud concentration, where a handful of providers host most of our critical systems, creates a single point of failure. When one data region or provider goes down, ripple effects hit everything from retail and finance to logistics and communications.”
Espinosa points out that this is a major security risk. “For UK businesses, this affects security more than productivity. During outages, normal safeguards are often bypassed: staff use personal devices, backup credentials circulate, and attackers exploit the confusion.“
With government websites also being disrupted by the AWS outage, it’s clear that the security risk could be very serious – and not just for retailers. “We urgently need diversification in cloud computing,” Dr Corinne Cath-Speth, head of digital at human rights organisation ARTICLE 19, told the Guardian. “The infrastructure underpinning democratic discourse, independent journalism, and secure communications cannot be dependent on a handful of companies.”
Amazon’s response and recovery timeline
AWS said that the outage was caused by a DNS resolution issue in the US-EAST-1 region, which disrupted multiple services. The AWS website states that “the underlying DNS issue has been fully mitigated, and most AWS Service operations are succeeding normally now”, although some services are still clearing backlogs. AWS states that it is “continuing to work toward full resolution.”
“The outage will end long before the disputes do,” Eaton warned. “Any business that treats this as a one-day incident is already behind. Downtime happens, but silence and slow responses are what cause real damage.”
Rafe Pilling, director of threat intelligence at cybersecurity firm Sophos, confirmed to the Guardian that the issue does indeed seem to be an IT outage and not a cyberattack. But, with threat actors also disrupting operations for online retailers on a regular basis, today’s AWS outage is a stark reminder that digital resilience isn’t just about preventing downtime – it’s about how swiftly and smartly businesses respond when it happens. For retailers, the question isn’t about if another disruption will occur, but when. Those with a plan will recover. Those without may find themselves in trouble.
Stay informed
Our editor carefully curates two newsletters a week filled with up-to-date news, analysis and research. Click here to subscribe to the FREE newsletter sent straight to your inbox. Why not follow us on LinkedIn to receive the latest updates on our research and analysis?
