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Study: Y2K already a problem

Although there are 640 days left until the year 2000, many companies already are experiencing millennium glitches, a new survey says.

There may be more than 640 days left until the new millennium, but many companies already are starting to experience glitches related to the Year 2000 issue in their computer systems, a new survey says.

According to a report released today by the Information Technology Association of America, 44 percent of respondents said their organizations have experienced such failures under actual operating conditions, and 67 percent reported failures under test conditions.

The so-called Year 2000 problem, or millennium bug, is rooted in the way dates are recorded and computed. Some older systems have typically used two digits to represent the year to conserve memory. With this two-digit format, however, the year 2000 is indistinguishable from 1900, or 2001 from 1901. As a result, system or application programs that use dates to perform calculations, comparisons, or sorting may generate incorrect results or not function at all.

That means devices from automatic teller machines amd elevator controls to wire transfer systems may not work on January 1, 2000.

"What we thought was surprising and significant was the percentage of failures already occurring," said Jon Englund, vice president of the ITAA. "Another thing that was interesting is they don't think the industry or the media have hyped the issue at all. They did think consultants had hyped it some, but not the media."

Sixty percent of respondents indicated that they do not think the issue is being overblown by the media. However, reactions were a bit more guarded when the focus turned to consultants and vendors. Respondents were almost evenly split on whether such firms are exaggerating the issue.

Another gloomy perception among the companies surveyed is that there is no doubt about the critical nature of the Year 2000 issue. Ninety-four percent said the millennium bug constitutes a crisis for the United States and the rest of the world. If left unchecked, 93 percent predicted their organizations would be damaged by the Year 2000 problem.

In addition, the survey found that companies seem to be split on their Year 2000 spending plans. Thirty-two percent said they will spend 10 percent or less of their information systems budgets this year on the problem, while 38 percent said they would spend 11 percent or more.

Englund said there appears to be a disconnection between the perception and the reality of how respondents saw the progress of their company's Year 2000 programs. For instance, 35 percent said their companies moved quickly on the issue, while another 31 percent said their firms picked up the slack after initial delays.

However, 45 percent said their companies are still in the early stages, either in the awareness or assessment phases of their firm's project. In addition, 25 percent of respondents expressed critical or negative views of their company's ability to get on with a program.

The ITAA emailed questionnaires to more than 2,000 readers of its Year 2000 Outlook publication. A vast number of recipients work outside the IT industry and are Fortune 500 companies. The results are based on the 450 individual companies that responded to the survey.

The ITAA plans to do another survey in the next three to six months, Englund said. "It will be interesting to discover what progress has been made."