January 3, 2000
Web posted at: 9:10 p.m. EST (0210 GMT)

In this story: Silver lining could include consumer savings Companies counting Y2K blessings Government agencies get Y2K boost Critics question cost RELATED STORIES, SITES

WASHINGTON (CNN) -- Now that the dark clouds of predicted Y2K chaos have cleared with hardly any trouble, experts are pointing to possible silver linings.

Governments and companies spent like there was no tomorrow in a massive effort to ward off the cyberspace storms that officials had warned could arrive on the heels of the new millennium.

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Inoculating the world against Y2K cost somewhere around $500 billion. In the United States, easily the most technology-dependent nation, the tab came to $360 for every man, woman and child.

But experts say that huge payout bought everyone not only protection, but also an across-the-board technology upgrade that might have taken years if not for the Y2K threat.

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CNN's Rick Lockridge looks at the technological benefits of preparing for Y2K. Real 28K 80K Windows Media 28K 80K

Silver lining could include consumer savings

"Most companies will tell you there have been lots of silver linings," said Harris Miller, president of Info Technology Association of Tomorrow.

Because they constantly seek competitive advantages, companies can be expected to claim that their Y2K outlays have helped them streamline their networks and enhance their capabilities.

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And the nature of these improvements for firms that depend on computers for the simplest of operations suggests that customers might benefit in the form of lower energy bills, better phone service and speedier banking.

The precautionary spending preparation didn't stop at new computers -- though companies bought plenty of those. It grew to include complete technology overhauls.

Many firms trashed their old machines and buggy software and replaced them with modern systems that were not only more efficient, but easier to use.

Companies counting Y2K blessings

When many Scandinavian firms prepared for Y2K, they found that they had installed software that was getting little if any use, said Bertil Mattsson of the international consultancy Cap Gemini.

Companies removed up to 40 percent of their programs as a result, easing the strain on their computer hardware, Mattsson said from his office in Stockholm, Sweden.

Ian Hugo, a leading British information technologist, estimates that in 1999 people updated and improved their computers to the same extent as during the previous three years combined.

For Honeywell-Measurex Corp. of Cupertino, California, Y2K was an opportunity to take a comprehensive inventory of its entire network.

"In the course of doing that, we essentially retired all our older mainframe applications," said Rich Walsh, director of information technology for the company, which builds quality-control systems for the pulp- and paper-making industry. Some of these applications had been running for 15 years or longer, he said.

Those actions bought those companies a big competitive advantage, according to technology industry lobbyist Harris Miller.

"They are going to be much more effective using their information technology going forward," said Harris.

Employees have been among the first to benefit. At Corning Inc., a U.S. maker of glass and optical fiber, technical support staff are now better able to identify any in-house computer problems thanks to Y2K-related improvements, said James Scott, Corning's information technology director.

Government agencies get Y2K boost

Does this mean we can expect more efficient government, too? After all, Washington spent more than $8 billion on the problem, feeding technologically-undernourished agencies like the Federal Aviation Authority, whose decades-old computers were starving for an upgrade.

"I think the Y2K success story to date is very much a testament to the government working in partnership with local governments, communities, corporations. I don't think there were -- there were very few pockets of people in this country who were not aware and prepared for the Y2K," said White House spokesman Joe Lockhart.

"It forced us, quite frankly, to look very, very closely at the software that operates our system and that's good," said Acting FAA Deputy Administrator Monte Belger.

"We have, in the course of this, gotten rid of a lot of systems that were antiquated, and it was more sensible to upgrade the system and replace it with a new, more modern system than to try to fix it," said John Koskinen of the President's Council on Y2K.

Critics question cost

But some question whether the same benefits could have been achieved at a lower cost.

Internet chat-room critics are using words like "fraud" and "extortion," and one Australian writer asked, pointedly, "Can we get a refund?"

Probably not. But everyone does get to share in the unanticipated benefits of streamlined systems and better use of the Internet, which analysts already say increases productivity -- and profitability.

And, finally, there is the relief of knowing that what's been called the biggest management challenge in history is all but behind us.

"The world's information systems have had a complete workover, and they are now passing the physical. We are in good shape for the new century," Bruce McConnell, director of the International Y2K Cooperation Center said.

Technology Correspondent Rick Lockridge and the Associated Press contributed to this report.

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