Glitch Of The Millennium

Around the computer industry, it's known as the millennium bug. On Jan. 1, 2000, computers the world over may stop computing--or, at the very least, may start making hundreds of miscalculations. That's because programmers for years economized on expensive computer memory by expressing the year in dates using just two digits--rendering, say, Nov. 1, 1995, as 11-01-95.

The problem: When the new century begins, most computers will interpret 01-01-00 as Jan. 1, 1900, not Jan. 1, 2000. Everything from driver's-license expiration dates to interest-payment calculations could be fouled up.

As usual, though, with adversity comes a business opportunity. On Oct. 30, IBM launched a service to help customers avert the 2000 crisis. Similar offerings--everything from consulting services to software tools that automatically search out and change date references--are being pushed by such companies as Andersen Consulting, Coopers & Lybrand, and Cap Gemini Sogeti.

There's plenty of demand: Gartner Group Inc., a consulting outfit, figures that 20% of business software will falter this year because of problems involved in computing the year 2000--and 90% will fail by 1999 if nothing is done. Worldwide, companies will have to spend $300 billion to $600 billion on fixes, Gartner figures.

LINE BY LINE. Solving the date glitches can be complex. Most companies use thousands of software programs--some that are decades old. Finding every embedded date can involve sorting through each program line by line. Union Pacific Corp. figures it has a date problem with 82% of the software it has tested so far. "If we [fix] this internally, it's probably going to be a $15 million project," says project manager Charles Parks. Computer hardware--including personal computers--has to be checked, too.

Surprisingly, many computer companies are only now getting their products brought up to date. IBM says that by the end of 1996 all its software and hardware will be designed without the millennium bug. Some other computer companies won't have the fix done until 1998. And simply worrying about the year 2000 may be shortsighted. "We're requesting that vendors certify that their products will work to the year 2100," says John F. Burns, a vice-president at Canadian Imperial Bank of Commerce. Forewarned is forearmed.

Before it's here, it's on the Bloomberg Terminal.