Bug Fix Cost Us Billions
Sydney Morning Herald
Tuesday December 7, 1999
COMPANIES and governments around the world will spend an estimated $US311 billion ($488 billion) to fix the Y2K computer bug, a new International Data Corp report says.
Spending this year alone is estimated at $US97 billion. An estimated $US184 billion was spent from 1995 to 1998, and a projected $US30 billion will be spent in 2000 and 2001, the market-research firm says.
The investment has reduced the risk of widespread computer failures caused by older computer programs unable to differentiate between the year 2000 and 1900.
"We're not looking for a global recession or for the world to stop spinning on its axis," said IDC research officer John Gantz.
When the Y2K bug was first widely publicised in the mid-1990s, computer consultants and economists warned it could disrupt vital transportation, power and communications systems. While many worries linger, particularly for less developed countries, fears of a global catastrophe have faded as companies pour money into rewriting or replacing old programs.
IDC estimates that global lost business revenue from computer failures should be about $US24 billion next year, and possibly as much as $US80 billion. The researcher expects $US129 billion will be spent in the US from 1995 to 2001 to correct the problem. Some $US102 billion will be spent in western Europe, $US64 billion in Asia-Pacific and $US16.5 billion in the rest of the world.
IDC's estimates, compiled from a survey of 20,000 technology officers, include spending on staff, services, hardware and software for fixing the computer bug. The estimates don't include legal costs or normal computer upgrades.
The IDC estimates compare with earlier projections from researcher The Gartner Group that pegged spending to fix the Y2K bug at $US300 billion to $US600 billion. Bloomberg News
© 1999 Sydney Morning Herald
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