The Y2K Issue, for Better--or for Worse
Much is being said about the cost of the Y2K problem, estimated at $1 trillion (''Y2K is worse than anyone thought,'' News: Analysis & Commentary, Dec. 14). It would be interesting to compare this figure with other technology-induced costs we live with every day: loss of work hours driving to work and/or in traffic jams; medical costs caused by pollution, use of pesticides; the recent ''natural disasters'' that appear to have been caused by man's activities. I wouldn't be surprised if these costs were bigger than the Y2K cost. Also, the Y2K problem is a one-time problem; the other ones are permanent or recurring.
An analogous situation existed in Germany and Japan after World War II. Factories ruined by bombardment had to be rebuilt from scratch, with newer equipment replacing antiquated and inefficient earlier investments that prior management had been reluctant to scrap. This contributed to the ''economic miracle'' in both countries.
Charles J. Bodenstab
First, most organizations will be ready for Y2K. For the relatively few organizations that are not properly preparing, the Millennium Bug will lead to their disappearance through failure or mergers. Such an ''economic cleansing'' is what is needed to spur innovation and weed out inefficient operations. Second, the Millennium Bug is forcing organizations to become more creative in managing information technology. This is leading to unexpected benefits--for example, better information-security and cost-management systems.
Third, the Millennium Bug is helping bring about closer economic ties among world economies. Evidence of how the Y2K issue is fostering international harmony can be seen in a recent U.N. resolution that deals with issues of cooperation in solving the Millennium Bug. Although the costs of preparing for Y2K are significant, and some glitches are likely to occur, we predict that by the spring of 2000, the massive benefits of Y2K will become apparent to investors, corporate leaders, consumers, and politicians.
Lawrence A. Gordon
Some of the problems that may be encountered: The media on which the data are stored cannot be read by new year 2000-compliant software; the computer and/or operating system can no longer run the ''old'' software needed to access the data; the software package works but treats dates as being in the current century (so a report intended to look at data from 1/1/1998 through 12/31/1998 finds no records, as the dates are treated as 1/1/2998 through 12/31/2998).
We discovered this ''beyond Y2K'' problem in the course of launching a service to provide access to old financial data. We consulted with many financial operations and asked 10 large companies that had replaced their software whether they had dealt with the above. The universal reaction was unprintable!
Updated Dec. 30, 1998 by bwwebmaster
Copyright 1999, Bloomberg L.P.