A tech-linked world faces 'Y2K'

In the first few seconds after midnight Jan. 1, 2000, the world will hold its breath. People will wonder whether the planes will fly, the phones will work, and the water will run.

Operated by computers, which may not know how to interpret the year "00," such systems face a risky future. It will cost the world anywhere from $150 billion to more than $1 trillion to fix the "Year 2000 problem" or, more simply, "Y2K." And while some countries are sprinting toward the deadline, others are still milling around at the starting gate. Alarmists sound shrill, but there are real concerns.

A US automaker that has spent millions of dollars to fix its computers may still face production delays because of a supplier's computer glitches in, say, Thailand or Argentina. Even the best-prepared companies won't know whether oil will flow, international calls go through, or air-traffic-control systems operate reliably in other parts of the world.

"Clearly, the problems with Y2K don't stop at the border," says Charles Kerr, an attorney and chair of the Year 2000 committee at Morrison & Foerster, a large international law firm based in San Francisco. In many countries, "there's not the kind of sustained directed approach to this as in the United States, countries in Europe, and Australia - it's just not there."

Then there's the doomsday scenario: Will a malfunctioning computer accidentally launch a nuclear missile? It's unlikely, experts say, because the US military has already fixed more than two-thirds of its 2,300 "mission-critical'' systems and Russia, while more problematic, is finally addressing the problem. This month, a Russian expert announced Y2K wouldn't affect his nation's launch systems but could affect its early-warning and air-defense capabilities. Russia has given NATO permission to investigate its systems, and the Pentagon has said it is not anxious.

But many developing nations seem blas about the threat. Take India. When a newspaper asked about potential Y2K havoc on the nation's foreign trade, a government official pointed out that the nation's harbors weren't automated. That's false comfort, Y2K experts say, because container ships coming into port could experience computer glitches. And imports of critical materials, such as food and oil, could be delayed because of Y2K problems at other ports.

Other potential glitches are keeping countries and companies on edge.

KLM Royal Dutch Airlines is thoroughly checking its planes for any computers or chips that might malfunction, but it says it's not certain it can fly them safely Jan. 1 because overseas airports and air-traffic control may not be up to snuff.

To reassure US passengers, Federal Aviation Administration chief Jane Garvey has promised to fly coast to coast shortly before midnight Dec. 31. China has taken a slightly different tack. The government recently ordered the heads of its domestic airlines to take a flight Jan. 1 - a big motivation to fix any computer flaws.

The crux of the Y2K challenge rests on a simple problem. Many older computers store only the last two digits of the year in their memory banks and assume the first two digits are 1 and 9. So, when 2000 rolls around, many machines will read the year as 1900 or, perhaps, stop functioning.

Rich nations can afford to hire the experts to read through millions of lines of computer code, much of it written in antiquated languages, to fix each instance of a two-digit year. Poor countries cannot.

According to estimates by the Gartner Group, a US consulting firm, at least two-thirds of the companies in Afghanistan, Bangladesh, Cambodia, Indonesia, Laos, Pakistan, Philippines, Thailand, and Vietnam - as well as China and Russia - will suffer a "mission-critical failure" because of Y2K.

Despite their technical sophistication, half of Japan's companies are also expected to experience such failures. Only 15 percent of companies in the United States face a similar threat. (See chart at right.)

This month, California-based software developer CCD Online Systems Inc. begins offering to Japanese companies software to check for the year 2000 problem, and convert programs, according to the Tokyo-based Nikkei Weekly.

Asia's economic crisis complicates the situation, limiting spending on the search for solutions.

"It's tough to get these countries to think about a problem that's a year away," says Paul Martin, special adviser on Y2K for the DC Green Party, an environmental and social justice party based in Washington. "They're just living day to day."

The result could affect not only banking and commerce, he adds, but also create environmental hazards, such as oil spills and failures of pollution control devices, as well as potentially degrading a government's ability to monitor such emissions.

Still, the picture isn't all gloomy. Last week, Uganda and Italy initiated their own programs to battle Y2K. "I'm afraid we're starting this a little late,'' Italy's Cabinet Undersecretary Franco Bassanini apologized at a news conference.

But better late than 00.

ONLY six of Africa's four-dozen countries south of the Sahara - South Africa, Mauritius, the Seychelles, Ivory Coast, Nigeria, and Namibia have national government-backed programs to tackle Y2K, according to a recent Reuters report.

South Africa reportedly leads the way in the region. The cost of Y2K preparations there could be as high as $4.8 billion, or 10 percent of its economic output, say government officials. Around the world, cost is one factor among many.

BERLIN The results of a study released last year predicted that Germany was lagging far behind other industrialized nations in preparing for the Y2K syndrome.

The study ranked Germany along with Armenia and Venezuela in readiness and concluded that half of German businesses would suffer some kind of loss related to the turn to 2000.

Reliable estimates are difficult to make, cautions Wolfgang Coy. The popular cyber-commentator and computer scientist at Berlin's Humboldt University is weary of doomsday prophesies.

"In Germany the problem isn't viewed as seriously, or as hysterically, as in the US," he says. But that doesn't mean there isn't a problem.

In the past few years, the German government has mainly concentrated on informing businesses about the consequences of the Y2K problem. Yet as of last May, only 55 percent of German companies had begun testing their production equipment for potential bugs.

The recent introduction of the euro is an important reason that Germany and other European countries are less ready for the double zeroes than the US or Britain. Programmers on the Continent - who normally would have been dealing with the Y2K problem - have been tied up for the past year preparing businesses for the start of the European common currency this month.

"England foresaw the problem better," says Mr. Coy. "But the English also didn't have to deal with the conversion to the euro."

Still, a report by the Federal Office for Security in Information Technology admits that Germany considered Y2K a "marginal" problem while US businesses were already busy tackling the issue. - Lucian Kim

LONDON One in 10 companies in Britain has already been hit by Y2K problems, according to Don Cruickshank, chairman of Action 2000, the body set up by the government to encourage business to prepare for and head off computer problems.

"Hitches have ranged from banks not being able to issue credit cards bearing correct expiration dates to unnecessary throwing away of food with sell-by dates going beyond 2000," Mr. Cruickshank says.

Early in the new year, Action 2000 began running TV advertisements stressing the need for businesses to act promptly.

The decision to run the ads was triggered by research showing that by November last year, 51 percent of medium-size businesses - with staffs numbering between 10 and 249 - had yet to take formal action to deal with the bug. Among firms with fewer than 10 staff members, 3 out of 4 had yet to act.

A spokesman for the Federation of Small Businesses, an umbrella body, said government promises to ensure that there would be enough computer experts to help them prepare for 2000 had been "slow in producing the help our members need."

Large companies and key public utilities have responded more positively to the threat. Cruickshank estimates that 90 percent of large firms are on course. And a huge effort has been made in Britain's financial district to ensure that all computers are year-2000 compliant.

Action 2000 is making no forecasts on the success of its attempts to ensure that householders face minimal problems with domestic appliances.

It is running a "home check" initiative to inform householders about where the "millennium bug" could strike and what domestic appliances should be checked. It has issued a free booklet and is running a nationwide action hot line.

Home Secretary Jack Straw has said the nation's police forces will face "unprecedented pressure" in the battle against Y2K problems. He said there must be no room for complacency as they prepare to police massive celebrations while at the same time deal with major problems that could be caused by the crash of computers which are not Y2K-compliant.

In fact, 1,450 officers of the national crime squad have been told they will all have to be on duty as the year 2000 arrives, in anticipation of failing alarm systems or the possible collapse of public utilities. - Alexander MacLeod

MOSCOW Russia was slow to recognize the problem, launching its own Y2K program just six months ago.

Although the country is overall less dependent on computers than the West, Russian government and industry are highly automated with old technology.

There are dramatically varying projections on what the impact will be on ballistic missiles, nuclear power stations, and early-warning defense systems. The problem has stoked the concern of the US, which has offered assistance in identifying critical military and government areas.

The head of the State Committee for Communications and Information was quoted as saying Jan. 17 that fixing Russia's computer problems would cost between $1.5 billion and $3 billion - or as much as six times the initial estimate.

He said the Y2K syndrome could have serious consequences for the military, considering that technology was sometimes 20 years old.

"Entities such as the Defense Ministry face greater difficulties from the viewpoint of all types of missiles," the Itar-Tass news agency reported him as saying after a symposium in the US.

However, the Russian government has generally been sanguine publicly about the problem, with some defense officials claiming that they will need only $500 million to ready the country's military computer system.

An American company, Relativity Technologies, announced in Washington this month that it had been chosen to provide technology for solving the Y2K problems in Russia.

Relativity said it would work with a Russian private company, Lanit Holding, to develop technology for government agencies and business. Lanit will focus especially on transportation and not nuclear or military installations. - Judith Matloff

JERUSALEM The Israeli army's computerization division is concerned that the turnover to 2000 could present massive problems for military and civilian computers in Israel.

The Israel Defense Force's computer department has identified 21 dates on which they suspect there could be serious malfunctions due to the Y2K bug, according to a report published recently in The Jerusalem Post.

The main concern is that public utilities will fail, leaving the country without electricity, water, and communications, according to the report.

But there are also concerns that global positioning satellites could fail and harm Israel's technological edge. The satellites were programmed in the early 1980s to operate for a precise amount of time - the period expires in August - and are used by the army as a key strategic and navigational tool.

Some dates are more troublesome than others, and the army says that the jump between Dec. 31, 1999 and Jan. 1, 2000 may not be the worst of them. One date that is problematic is Sept. 9, 1999 - 9-9-99 - a combination of numbers that some computers recognize as infinity.

The fact that the year 2000 is a leap year could throw another wrench into the system. When trying to punch dates into its computers, the army said when they entered the date Feb. 29, 2000, the computer said it didn't exist.

The entire army is under orders to manually change the dates on all computers after Dec. 31.

To at least some people, the mix-ups expected to take place in such areas as travel and public utilities are a sign of greater things to come at what some consider the turn of the millennium.

Christian "end-timers" - such as the members of the Denver-based Concerned Christians cult deported from Israel last week on suspicion they would commit violent acts in Jerusalem in order to hasten the return of Jesus - believe that the Y2K bug is a manifestation of the chaos predicted in the Book of Revelation. - Ilene R. Prusher

BEIJING "Y2K has the potential to endanger not only computers, but any device that incorporates a microchip," says Zheng Jianling, a computer expert at the China Software Testing Center in Beijing.

As Mr. Zheng points to his high-tech, Japanese-made, chip-run timepiece, he says, "This watch may think it's the year 1900 at the stroke of midnight on Dec. 31.

"On the other hand, it may just run out of control because it's not programmed for the year 2000," says Zheng, whose office runs Y2K risk-and-solution-training seminars in Beijing.

"The same thing could happen to machine control systems in factories, chip-centered remote-control devices, and automated prison locks," he adds.

The Chinese government has set up Y2K training centers like Zheng's in major urban centers.

"China's State Council [or Cabinet] has ordered all government departments and state-run companies to adjust computer software, hardware, and related technology by March to minimize the Y2K effect here," says a Chinese official who asked not to be identified.

The government has focused on protecting sectors that include banking, securities, aviation, and power. The most widespread precautions have centered on the defense establishment, he says.

"It's not inconceivable that missile tracking systems in Russia, the US, or China inaccurately report enemy attacks due to Y2K-related glitches," says the official.

Trainer Zheng says that although China was a comparatively late participant in the information revolution, it is racing to catch up with the world's leading industrialized nations while jumping the Y2K hurdles.

China now has only 10 million computers, but PC sales rise by 50 percent annually. Most computers here are imported, and major American firms - including Microsoft and IBM - are helping Chinese customers exterminate Y2K bugs as the globe counts down to 2000.

Yet some computer-industry experts here say Beijing may have invested too little too late to build a great cyber-wall of defense against the 2000 bug. - Kevin Platt

MEXICO CITY By some reports Latin America is as much as a year behind schedule in preparedness for the 2000 conversion.

But other experts say such generalizations ignore the advances that some countries within the region have already made.

In Mexico, which started working on the problem in 1997, a commission named by President Ernesto Zedillo last June drew up a national Y2K program that has won special recognition from the World Bank and the Organization for Economic Cooperation and Development.

The United Nations also named Mexico one of eight countries to organize regional responses to the techno-challenge.

Mexico's program has especially put fire under the feet of public agencies and services, while the country's private companies have been slower on the uptake. A commission survey of private companies last year found that while most businesses were aware of the issue, few were doing anything about it.

Preparing for a membership meeting set for next week on the "Year 2000 Crisis," the American Chamber Mexico found that only 30 percent of nonfinancial companies are already working on the problem.

Yet while some companies seem to be assuming the issue doesn't apply to them, many others recognize that, even if eventual problems may not be a life-or-death issue in their case - as it could potentially be for hospitals or transportation providers - glitches could certainly hurt them in the pocketbook.

"If we didn't do something about this now it could be a real problem for our clients later," says Maria Dolores Quintanilla, a Mexico City travel agent whose agency has technicians reviewing the company's systems. "Unhappy clients mean lost business."

- Howard LaFranchi