God - what a complete scam.
Now that the new millenium is around the corner, it doesn't surprise me that lunatics pop out of the woodwork predicting the end of the world. It embarrasses me though, that the IT industry (of which I'm a part) has become infected with it's own peculiar brand of "year 2000" hysteria.
I read the Emerald Research report on Zitel/MatriDigm. I couldn't stop laughing.
Some highlights from the report (in brackets) along with my comments:
[ First, consider over 80 percent of the world's data is stored on IBM mainframes, representing over 200 billion lines of code. Second, consider that between five and ten percent of these lines of code contain, or are sensitive to, date fields that are largely expressed in some form of a MM/DD/YY format where the year is represented by a two digit code...Third, consider the problems that develop when the years 2000 or later are involved. Instead of expressing the year as 2000, a two digit system would express the year as 00. This creates dramatic problems when dealing with applications such as mortgages, leases, contracts, interest payments, bonds or forecasting systems where time periods are calculated...Left uncorrected, all date sensitive calculations involving the years 2000 or later will result in massive computer malfunctions. ]
--- You can almost hear Carl Sagan in the background, "...BILLIONS AND BILLIONS of lines of code..." How on Earth did they come up with these estimates? If date sensitive calculations cause "massive computer malfunctions", then why aren't we seeing the entire financial services industry collapsing overnight as their computers are unable to calculate - let's say - the payment schedule on a thirty year mortgage that starts today and ends in 2026?
[ It has been estimated that the price tag to address the Year 2000 Problem domestically is between $300 billion and $600 billion. ]
--- Here we go again with the big, scary numbers. Let's see....they think it's going to cost $600 bil. to basically fix some old COBOL code and modify some databases to accommodate an extra 2 digits in the date field - and (I assume) all this money will be spent before the year 2000. In other words:
8% of 1996 GDP or
70 times Microsoft's 1996 revenues or
the entire defense budget for 2 years
will be spent to fix a problem which has about as much import as converting from a 5 digit zip code to zip+4. By the way, this only applies to relatively obsolete code since this is basically a non-issue in most modern applications and DBMS.
[ The MatriDigm system offers several significant advantages over alternative solutions. First, it is expected to be able to convert over one million lines of code per hour ]
--- Ladies and Gentlemen, we can all breathe a collective sigh of relief - the Earth is saved.
[ Leon A. Kappelman, who headed the study, stated that many information systems mangers are either afraid or unwilling to present the year 2000 problem to senior management..]
--- Leon neglects to mention that the reason these information systems managers are unwilling to present the "problem" is because THERE IS NO PROBLEM. I imagine they're also afraid they'll be laughed out of the office.
[...MatriDigm's portion of revenues earned will be approximately $0.30 - $0.40 per line of code charged to the customer...]
I particularly liked this one. It's quite obvious Emerald doesn't understand the software consulting business very well. Take a look at Zitel's last 10-Q and balance sheet and you'll see what I mean.
[ Already this year, a number of Year 2000 related companies have seen significant increases in their share prices. Data Dimensions (DDIM - NASDAQ) stock is up 373 percent year to date giving it a market cap of $82 million , Viasoft (VIAS - NASDAQ) is up 784 percent and has a market cap of $974 million and Computer Horizons (CHRZ - NASDAQ) is up 93 percent and has a market cap of $444 million. ]
--- This reads like the short seller's dream team. FYI, also take a look at the 10-Qs for DDIM and CHRZ. If you could put ZITL, CHRZ, and DDIM in the same boat, you'd have to christen it the Titanic. My opinion of VIAS is somewhat better; however, it's stock is still grossly overpriced.
*****************************************
It's clear that this "year 2000" issue is at best, a minor problem blown way out of proportion, and at worst, a complete hoax perpetrated by the usual gang of idiots at these sleazy "investment research" firms (such as Emerald) to goose the stock price of obscure, and poorly performing companies. |
