Japanese lagging on Y2K called global issue

TOKYO -- The world's key supplier of microprocessor chips to the PC industry warns that apparently lagging efforts by Japan's public utilities to correct year 2000 computer bugs could snowball into serious disruptions of global personal computer shipments and, in turn, damage the U.S. economy next year.

That is because a shutdown of the Japanese power grid next January could jeopardize supply lines to the personal computer industry around the world, Donald K. Rose, general manager of Y2K projects for Intel Corp., said in an interview here.

The trouble, Rose said, is that it's impossible to gauge just how real that risk may be.

``The perception is that we are at high risk in Japan, because there's been no open disclosure of information,'' he said.

Rose said it has been ``difficult, like trying to get through a brick wall,'' to get any information about Y2K compliance from Japanese electric companies, water and sewer providers, telecommunications firms and other suppliers of critical infrastructure.

If those industries found themselves trying to solve Y2K problems after the fact, he said, ``there would be serious disruptions to building chips around the world, and we would not be the only ones affected. You could have the whole industry flat on his back.''

He said it has been his experience that countries and companies that do not want to talk about their Y2K issues tend not to be prepared.

``Their attitude is, `Just believe me: We're taking care of our problems,' '' Rose said of Japanese utilities and other public agencies. ``They say, `We promise it will be OK -- you don't need to ask.' Our attitude is to trust, but also to verify, and we've been unable to do that.''

Japan, with Asia's single largest economy, encompasses nearly one-fourth of Intel's ``mission critical'' suppliers, about 8 percent of the world's computer market and a large number of important computer manufacturers, including NEC, Fujitsu, Toshiba and Hitachi.

Intel, based in Santa Clara, sells about $2 billion worth of chips to Japan each year, but also buys nearly $2 billion in parts and subcomponents for its microprocessors from Japanese industry, according to Koji Shiro, director of Intel's technology manufacturing group in Japan.

As part of its global efforts to assess Y2K compliance among its suppliers and its own factories, Intel began auditing Japanese vendors late last fall and discovered that only 8 percent were ready for computer problems associated with the arrival of year 2000. But after the company worked with the Japanese firms to address known problems, some 67 percent are compliant and the rest should be ready for Dec. 31.

``There was a dramatic turnaround in just six months'' in the companies Intel surveyed, Rose said, because overcoming Y2K problems is not a complicated technical issue but does requires serious management attention.

Extrapolating from the private-sector data, Intel officials believe Japan's public agencies aren't properly prepared for Y2K.

They can't say for sure, however, because neither Japanese industry nor government has cooperated.

Intel's attempt to use American-style ``openness and collaboration'' to help counter Y2K problems may explain the reluctance of Japanese firms to cooperate with the company's audits. In Japanese culture, information is not freely shared among companies, but is parsimoniously distributed after careful brokering. Intel's suggestion that collaboration might prove mutually beneficial generally would resonate only with its longtime business partners.

A spokesman for Tokyo Electric Power said the company is carrying out ``perfect research'' on how to overcome its Y2K problems and expected that all critical systems would function properly next New Year's. He said the company would be unwilling to supply detailed information on its Y2K efforts to a private company, for fear of disclosing company secrets.

An official of the Ministry of International Trade and Industry, Kazuo Yuhara, said the government will be ``pretty much prepared'' for Y2K and expressed surprise at Intel's criticism.

``It sounds like the approach of Intel to each company created some kind of misunderstanding,'' he said. MITI officials were to meet with Intel this week to describe government involvement in Y2K preparedness, he said.

Intel is not the first outsider to raise questions about Japan's Y2K preparedness.

The Gartner Group, a high-tech research firm, recently upgraded its evaluation of corporate Japan's preparedness for Y2K, but expressed concern about whether the ``national, regional and municipal government technical systems'' were being worked on with the same intensity.

Gartner's initial survey stung and surprised many Japanese, because it rated high-tech, industrial Japan on a par with underdeveloped nations like Pakistan and Panama in its preparedness for Y2K.

-- regular (zzz@z.z), May 26, 1999

Answers

For those who have a difficult time seeing beyond our national borders or code on a computer screen this article should help you understand that Dominoes isn't just a place for pizza.

Mike ==================================================================

-- Michael Taylor (mtdesign3@aol.com), May 26, 1999.

You beat me to it, was just about to post.

PNG, oh PNG!

Diane, sighing in Silicon Valley

-- Diane J. Squire (sacredspaces@yahoo.com), May 26, 1999.

'it has been his experience that countries and companies that do not want to talk about their Y2K issues tend not to be prepared. '

'it has been ``difficult, like trying to get through a brick wall,'' to get any information about Y2K compliance from Japanese electric companies, water and sewer providers, telecommunications firms and other suppliers of critical infrastructure.'

My, oh my, doesn't that sound familiar? But don't worry...that's the attitude Over There. We're OK, except of course for Their Effect upon US. My parents, the devil, social environment...everything and everyone else but me .... created this awful problem.

-- Shelia (Shelia@active-stream.com), May 26, 1999.

This article highlights one of my bigger concerns about next year. Fix on failure could take a lot longer than anticipated...

-- Kevin (mixesmusic@worldnet.att.net), May 26, 1999.

...if chip manufacturers themselves are facing Y2K problems.

-- Kevin (mixesmusic@worldnet.att.net), May 26, 1999.

Kevin-

You mean that they can't just make them manually...like they used to do in the old days?

-- Mad Monk (madmonk@hawaiian.net), May 26, 1999.