Last Updated 28 Jan 2021

Understanding The Y2k Bug

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As the Millennial sun rose over human civilization, in the independent republic of Kiribati, a group of some thirty low lying coral islands in the Pacific Ocean that straddle the equator and the International Date Line, the reality of the Y2K bug became apparent. This long awaited sunrise marks the dawn of the year 2000. Kiribati's 81,000 Micronesians observed nothing different about this dawn, they only received TV in 1989. (

However, those who live in a world that relies on satellites, air, rail and ground transportation, manufacturing plants, electricity, heat, telephones, or TV, experienced a true millennial shift, or not. We finally saw the extent of the networked and interdependent processes we had created. At the stroke of midnight, the new millenium closed the greatest challenge to modern society we have responded to yet. We didn"t experience this event, as chaos or social transformation.

I am describing the year 2000 problem, known as Y2K (K signifying 1000). Nicknamed at first "The Millennial Bug," increasing sensitivity even escalated the nickname to "The Millennial Bomb." The problem begins as a simple technical error. Large mainframe computers more than ten years old were not programmed to handle a four digit year. Sitting here now, safely in the year 2000, it seems incomprehensible that computer programmers and microchip designers didn't plan for it. Programmers did whatever was required to get a product up and working; no one even thought about standards.

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This computer bug has been predicted to impact the world anywhere from a minor problem to the end of a civilization. Whichever view you took on the subject it is clear that this bug had a definite impact on the economy. Whichever view anyone took on this issue, didn"t really matter because the point is that everyone thought about it and dealt with the issue in his or her own way.

In order to understand the Y2K bug we must first understand what it is. For many years electronic storage was very expensive. In the early days of computing a Megabyte or a million bytes of information could have cost up to $100,000 to store electronically. This same amount of information storage can now cost around ten cents. (Barr)

Many programs that are date sensitive will react to this bug in a negative way. A good example of a problem that could occur due to the bug would be that of banking software. In that case one of the software"s functions would be to bill all of its customers with outstanding loans. This program works by sending the bill progressively every month until the loan is paid off.

If the computer were to think that it was the year 1900 then none of these loans would have even been made yet and the computer would become unstable or cease to function. Much of this software can be repaired or replaced with new versions, however, some of it is not as easily replaced. A great deal of the code that is causing worry at the moment is actually imbedded in automated machinery. This code can"t be repaired, except by replacing the machinery itself. This code is in many of the machines that run companies, public utilities, and are even in our homes in such appliances as VCRs.

This calculation problem explains why the computer system at Marks & Spencer department store in London destroyed tons of food during the process of doing a long-term forecast. The computer read 2002 as 1902. Instead of four more years of shelf life, the computer calculated that this food was ninety-six years old. It ordered it thrown out. A similar problem happened recently in the U.S. at the warehouse of a freeze-dried food manufacturer.

In September 1998, Datamation magazine estimated that, on average, about 7% of all electronics are date sensitive and In November 1998, PCWeek, another leading trade journal, put the number at 5%. (Gibbons) The main emphasis seems to systems with many chips all working on real time clocks such as manufacturing plants. These systems were estimated at up to 30% not compliant with the Y2K problem. Companies with these systems have had trouble being ready for Y2K because in order to prepare for the problem the affected chips have to be isolated and repaired. In a system with thousands of these chips and little documentation on each one, this is an almost impossible chore. Replacing entire systems can cost millions of dollars and many companies can"t afford the cost of the repair. Billions of dollars were spent preparing for this event and much more will be spent in recovery. Most companies have been addressing the problem for the past few years.

Very rarely do we get the chance to watch the entire industry lifecycle, from introduction in the early 90"s and the decline and death of the industry in the early months of 2000. The entire industry has opened up just to deal with this problem. In the US most mission critical equipment was tested before 1999 and was either compliant or repaired. The systems that caused most concern were things like power grids, telephone networks, and air and land traffic controllers. These systems were of such great concern because some of these computers systems and networks have existed since the late 1950"s. The fact was that no one could afford to entirely replace these systems, they had to be upgraded to be compliant.

What was the impact on Government, Industry, and Small Business? There are several impacts to Government, Industry, and Small Business. Dates that can impact the leap year algorithms, boolean dates, fiscal year dates, calendar dates, and ASCII code dates. There are separate ramifications to the new dates. For the Government, the dates have a major impact across the board. Every Government agency, from Federal to City, will be impacted.

The Federal Government uses computers on a daily basis and without them, the Federal Government is not able to operate. Some specific examples are in the Department of Commerce, Department of Defense, and the Department of Justice. The Department of Commerce utilizes computers to run the National Oceanic Atmospheric Association (NOAA) systems that are used to chase Hurricanes. The problem is that several of the computers are used to log different data and use date/time stamping with that data. This data is later analyzed to try and map hurricanes for the future. If the Y2K issues are not resolved, important data will be lost.

The Department of Defense also uses computers to a very large extent. This is especially true for the DOD large complex machinery used to defend the country. There are very few parts of the Army, Navy, Air Force, and Marines that do not use computers. Computers are the backbone to DOD and without them, there is a real fear that our armed forces would not be able to defend this country. (Office of the Assistant Secretary of Defense)

The Department of Justice has an even worse problem. They are charged with keeping track of criminals and federal indictments across the country. Because of the complexity of the laws, if the computers used to keep track of indictments and criminal records are not Y2K compliant, then the Justice system could have criminals cleared of any wrong doing because of a simple date issue. It is well known that if the date or address were wrong on an indictment or a search warrant, anything found because of the indictment or warrant could not be used in court. (Cohen)

The Government agency that has had the most influence on the whole Y2K issue was the Internal Revenue Service. Basically the IRS has the greatest concern because they are charged with the duty of collecting revenue from the taxpayers in order to run the country. The theory is that the IRS, through Congress, could influence or scare business, banks, and individuals into awareness. (Chandrasekaran) This awareness translated into the hundred billion or so expenditures that banks, businesses, and individuals spent on being Y2K compliant.

Industry had the same basic problems that the Government had. They rely on computers in almost every aspect of the business. From robotic assembly lines to employee payroll, all of industry relies on the computer to run its day to day operation. (Gwynne) The problem that both industry and Government have is that there was no contingency to the Y2K issue. Both industry and Government have several backup systems.

The problem with small business is that they rely on the computer to do many of the tasks that employees used to do. In small business, people were employed to handle payroll, marketing, office management, files, record keeping, and profit/loss ledgers. These people were replaced with the advent of the computer. Now any small business could operate without minimal employees. The office manager could now handle payroll, marketing, files, records, and ledgers right on the computer. The computer became the key piece of equipment for the small business. Without the computer, small businesses could not stay in operation. Most small businesses have become dependent on the computer to replace employees. Without a computer, small businesses would need to hire additional personnel and return to paper and pencil to operate.

An example may be Nations Bank; it may have its primary mainframe computer, for all its checking accounts, in one central place. There is a hot backup (a hot backup is a main frame computer that records the same exact information that the mainframe computer is recording, but it does not handle any transactions, just records the information) that is located in a different part of the country, say Colorado. In this way, if a major disaster were to devastate California, the hot backup would come on line take over the responsibility of the mainframe. (McMahon) In this way, vital information would not be lost. This was all thought out years before Y2K. Y2K would impact both mainframes (the primary and the backup) and all the data would be corrupted.

What did Government, Industry, and Small Business do to combat the Y2K Issues? For both Government and Industry, it was not be a problem to combat Y2K. Both areas, through consulting agencies and internal working groups, developed a series of plans to combat the Y2K issue. The standard procedure is to first do an inventory and assessment on the agency. After the assessment is made, a renovation plan is developed to renovate the different systems. After renovation, a validation phase, where the renovation is tested using the different Y2K dates to ensure that no problems were encountered. The implementation phase is to implement the system into action, and begin watching the system during the actual crossover dates.

The cost to perform all of the plans and phases are high. On most major DOD systems, the cost ranges from $100,000 to over $5 Million. For industry, their costs are about the same. It does not matter if the agency does it internally or hires consultants to perform the work. The consumer and/or taxpayer absorb the high costs in industry and/or Government caused by the expenditure on solving Y2K issues. Industry passed the costs to the consumer by increasing its price on the product. The Government modified the budget to get the necessary funds to ensure Y2K compliance.

The real problem lies with small business. The plans and phases that were developed by industry and Government must also be accomplished by small business. The problem is that small business does not have the money to expend on the Y2K issue. Small businesses do not have the overhead or capital to afford to test its systems and ensure that Y2K problems do not exist in its machine. This is where the actual computer industry comes into the scene. Since most small businesses do not rely on consultants and do not have a computer expert on the payroll, then small businesses must rely on the software companies to ensure that the computer is Y2K compliant.

Marketers quickly recognized the fact that many small businesses would be forced to purchase new hardware, software, and peripherals. Marketers were not afraid to sell replacement equipment that was not affected by this bug. Consultants profited on the fact that many individuals and small businesses were very ignorant on the issue at hand and how many individuals had little to no knowledge of what was occurring in the machine that they were using. Many of these machines could have been upgraded with a small BIOS chip that would allow the machine to function with the new date format.

Application software that is used with Windows 98 may not be compliant, making the system non-compliant. Microsoft could not be held responsible for other software packages built by other software companies. In addition, most software companies will not support older versions of its software. An example is that Microsoft does not support Windows version 3.1. This is based on the availability of newer versions of Windows being available to the consumer. So where does this leave the small business? There is Federal and Local assistance available to help small business ensure that the Y2K issue is resolved prior to the actual dates. If the small business did not recognize that it has a problem, then it could not work to fix the Y2K issue in time. By combining their resources and working with the local support, a network of consultants could work together to fix the problem before the actual Y2K dates came.

Here it is April 3, 2000, and the lights are on, there"s plenty of water, and the stock market is at a record high. There is widespread suspicion that the Y2K computer bug was no more than the media overreacting and getting people excited for nothing, and Y2K was a big dud. There may be some validity to this theory, but I think the fact is that the problem was reduced by our efforts in making all computers Y2K compliant.

Some people believe that disruptions may still occur in coming days as government and industry resume full operations following the minor problems that either were overlooked or were unanticipated. I think the investment in Y2K upgrades, which totaled an estimated $100 billion just in the United States, kept the most important computer systems running.

The most serious malfunction so far was when the Defense Department computers temporarily failed to communicate with a reconnaissance satellite. Officials did not acknowledge the breakdown to the media until seven hours after it was discovered, in order not to cause people to panic about one relatively minor Y2K related computer failure.

Considering the seriousness with which not only the Pentagon but also almost all other companies took to the possibility of a Y2K malfunction, I doubt that it could have amounted from hype alone. Part of the Y2K panic, of course, came from the fear that computers would do bazaar things such as transfer all our money from our accounts into someone else"s account, or traffic lights would make errors and cause terrible accidents. I agree that that is hype that amounted from the media twisting and predicting the results of Y2K without basing their information on facts.

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Understanding The Y2k Bug. (2018, Jun 11). Retrieved from

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