State of Y2K Compliance of Everyday Products

July 1999

Contents

1. Household Electric Products
2. Telephony
3. Internet
4. Cable TV
5. Personal Computers
6. Passenger Vehicles and Related Equipment
7. Automatic Teller Machines
8. Credit Cards
9. Elevators
10. Building Management
11. Electric Power
12. Gas
13. Oil Imports
14. Food
15. Water Supply
16. Sewerage
17. Newspapers
18. Insurance Coverage

1. Household Electric Products

(1) Air Conditioners, Refrigerators, Washing Machines, and Other Appliances

(1) Appliances are not subject to Y2K problems.

(2) Although some appliances have a time control feature (e.g. timer control), they are controlled by relative time in 24-hour increments (e.g. they can be set to turn on in four hours). It has been verified that appliances do not have a date control function that includes the year.

(2) Audio-Visual (AV) Equipment

(1) VCRs, TVs, and video cameras are among the AV equipment that has a date control function that includes the year. According to a survey of 21 manufacturers, less than 5% of only four companies' products have the potential to malfunction due to Y2K problems.

(2) In the case of TVs and VCRs, potential malfunctions include incorrect display of the day of the week and inability to program the unit to record using G-codes. These malfunctions can be rectified by the user: in the former case by recording manually instead of programming with the G-code; in the latter case, by resetting the day display.

(3) Video cameras may experience the leap year problem (i.e. they may display "March 1" when the date is really February 29). This problem can be rectified in makeshift fashion by turning off the date and time display on February 29 (if the camera is used on that day) and correcting the date on the following day.

(4) For the products subject to malfunction, all four concerned companies are disseminating information via their Web sites and have established a liaison to respond to inquiries.

(3) Facsimile Machines

(1) Eleven of 25 facsimile machine manufacturers have products that may malfunction (e.g. erroneous display) due to Y2K problems. Most of these products were manufactured prior to 1997.

(2) In most cases. the above malfunctions will not affect the machine's transmission/receiving functions. The malfunctions include (1) erroneous date display on the machines panel or on transmission records or transmission control reports, and (ii) erroneous display of days of the week or leap year. Certain models, however, may experience other malfunctions such as (iii) erroneous transmission time if the machine is set to operate at a designated time that extends into 2000 and (iv) failure to transmit if the machine is waiting to re-send when the year changes to 2000. However, models subject to these latter two malfunctions will operate normally after the year 2000 has arrived.

(3) Such display malfunctions can be rectified by the user by resetting the date on the machine's display panel, except in a very small minority of models that require ROM replacement.

(4) All concerned manufacturers have already published information on their Web sites regarding models subject to the above malfunctions and the procedures for fixing them.

2. Telephony

(1) Telephones and Mobile Telephones

(1) All but one of 38 manufacturers of home telephones have completed checking whether their products are subject to Y2K problems. The one remaining manufacturer is in the process of doing so. Two companies have reported that their telephones will experience display malfunction unless proper steps are taken with regard to the fact that 2000 is a leap year. This display malfunction can be rectified by the user by manually resetting the display.

(2) All but one of 40 manufacturers of mobile telephones, PHSs, and wireless pagers have completed checking whether their products are subject to Y2K problems. The one remaining manufacturer is in the process of doing so. Three mobile phone manufacturers, one PHS manufacturer, and one wireless pager manufacturer have reported that their products are subject to malfunctions such as erroneous display.
The types of malfunctions that will occur include (i) erroneous display of mail receipt records and replaying of messages out of order, (ii) erroneous year display when the year changes to 2000, and (iii) erroneous display if proper steps are not taken with regard to the fact that 2000 is leap year. However, the communication function itself will operate normally.
Excluding the one company still checking its products, the above malfunctions are rectified by the following methods: (i) repairs by a dealer are required in some cases; (ii) in other cases, the problem is rectified by downloading a software fix from the manufacturer's Web site; (iii) in other cases, the user can rectify the problem by manually resetting the unit. For products fixed by methods (i) or (ii), the relevant information is available on manufacturers' Web sites.

(2) Telephone Service

(1) As of June 30, 1999, the major telecom carriers had completed 99.7% of the simulation testing of their telephone lines, leased lines, and other critical communication systems (the percentage for mobile phones was 97.8%). They plan to be 100% completed by September 30, 1999. NTT, the largest carrier, has already completed converting its switches and customer administration systems to four-digit year format, and has completed the Y2K compliance process for all its systems, including peripheral equipment.

(2) In addition, formulation of crisis management plans as a precaution against emergencies was 40.7% complete as of June 30, 1999. Crisis management plans are scheduled to be 99.2% completed by September 30, 1999.

3. Internet

(1) Networks

(1) Since the year is not among the information processed by the Internet Protocol, it is deemed that Y2K will not pose any communication problems with respect to transmission and switching functions.
In addition, the Internet is configured so that the network is backed-up by the network as a whole. Even if a failure occurs due to a mishap or other cause, the affected part of the network is automatically circumvented.
Accordingly, it is deemed highly unlikely that the Y2K problem will interfere with Internet's basic communication function.

(2) However, administrative functions and add-on functions based on mail storage and user administration do process information that includes the year. Hence, there are concerns that these functions could be affected by date (i.e. year) processing malfunctions.

(2) Internet Service Providers

(1) As of June 30, 1999, the major Internet service providers (ISPs) had nearly completed the Y2K compliance process. They plan to complete everything by September 30.

(2) Information regarding ISPs' state of Y2K preparedness and other such matters is available through the Internet, among other sources.

(3) Users' Systems

The computers used by Internet users also constitute components of the Internet. Because computers incorporate browsers for Internet access as application software, the Y2K compliance process is the same as for personal computers.

4. Cable TV

(1) Cable TV Broadcasters that Retransmit Broadcast Programming

The major cable TV broadcasters retransmit broadcast programming. Since this does not entail processing of year data, there is deemed to be no problems with such retransmission.

(2) Cable TV Broadcasters that Broadcast Independent Programming

Among cable TV broadcasters that broadcast independent programming, there are concerns that automatic transmission systems for broadcast programming will be affected by Y2K problems. As of June 30, 1999, 71.5% of these broadcasters had completed simulation testing and they are currently still proceeding with the Y2K compliance process. Automatic transmission systems are expected to be fully Y2K compliant, with the exception of those unable to be completed on time due to equipment replacement or other unavoidable circumstances.

5. Personal Computers

(1) Hardware

(1) Computer hardware's calendar control is performed by basic software called BIOS, which controls input and output. If BIOS is not Y2K compliant, the date will not automatically change from December 31, 1999, to January 1, 2000. To rectify this problem, one must manually reset the date or take other such action.

(2) In computers shipped in recent years (generally since 1996 - 97), BIOS is Y2K compliant, so Y2K problems will not occur. Computers shipped prior to 1996 or 1997 will have a problem in that the date will not automatically change to 2000, but in most cases, they can be made Y2K compliant with a simple operation.
For example, users can make their computers Y2K compliant by manually resetting the date as instructed by the manual when they use the computer for the first time in 2000. In addition, some manufacturers are providing software fixes through their Web sites.

(3) Users can check regarding the Y2K compliance procedure for individual models by means of information available on the Web sites of manufacturers and other vendors.

(2) Operating Systems (OS)

(1) The operating system (OS), which controls a computer's operation, uses BIOS output for the date control function. The OS is fundamentally dependent on BIOS's state of Y2K compliance. OSs sold recently (since the summer of 1998) include some that have a feature that recognizes the year as 2000 even if BIOS outputs 1900.

(2) Users can check regarding the Y2K compliance status of individual products by means of information available on the Web sites of manufacturers and other vendors.

(3) Application Software

(1) In the case of application software for personal computers, such as word processing and spreadsheet software, most users have the most recent versions, which are generally Y2K compliant. Nonetheless, depending on the software's version and usage environment, even commonly used software may experience slight malfunctions related to date display or other functions. Accordingly, users must check with the manufacturer regarding the Y2K compliance procedures for individual products.

(2) Even if there is a problem, it is ordinarily easily rectifiable through such means as changing the input method or using a remediation tool provided by the manufacturer.

6. Passenger Vehicles and Related Equipment

(1) Passenger Vehicles

In a survey conducted in December 1998, all auto makers stated that their vehicles are problem-free. All of them have already conducted final verification and released a safety statement.

(2) Car Navigation Systems

(1) Aside from the so-called Y2K problem, car navigation systems have their own unique problem with their global positioning systems (GPS). Specifically, the week-number data (which indicates how many weeks have elapsed since the week of January 6, 1980, which is designated as week 0) included in the signal from GPS satellites are 10-bit digital signals. Consequently, the week number will return to 0 (roll over) in the 1024th week (i.e. the week of August 22, 1999). This will result in malfunctions in some products.

(2) Eleven of 18 manufacturers surveyed responded that their products will not malfunction. The other seven responded that some of their products may malfunction.

(3) The malfunction, caused by the rollover of the GPS signal, will result in the navigation system' failing (or taking a long time) to start up.

(4) These manufacturers are notifying users individually if the users are identifiable. For models used by a large number of unidentified users, they are providing information via the Internet, press releases, or other such means.

(3) Traffic Signals

(1) Traffic signals are equipped with a 30-year calendar function. The vast majority of traffic signals will not experience Y2K problems, but some older signals require ROM replacement or other such remediation.

(2) Remediation work has been completed on over 93% of the traffic signals linked to traffic control centers, excluding signals scheduled to be replaced this year. Simulation testing is expected to be completed by September 1999.

(3) Traffic signals are designed so that the light will never simultaneously be green in all directions of an intersection. Traffic collisions will not occur due to signal malfunction. In addition, pedestrian signals are designed in the same manner. Signals will not give a green light to vehicles in either direction while a pedestrian is crossing the street.

(4) Fire Trucks and Ambulances

(1) According to a June 1999 survey of fire defense entities (911 entities) throughout Japan, 100% of fire departments with computer-controlled, highly functional hook-and-ladder trucks and chemical trucks had completed necessary Y2K remediation work or had verified that remediation is not necessary. Ninety-eight percent of fire departments with computer-equipped first-aid equipment (e.g. defibrillators) had done likewise, as had 99% of fire departments with rescue equipment (e.g. electromagnetic-wave search equipment).

(2) The fire departments that had not yet completed verification or remediation work have completed planning their remediation work or are in the process of investigating. Y2K problems are not expected to interfere with fire-fighting or paramedic operations.

7. Automatic Teller Machines

(1) Automatic teller machines (ATMs), used for withdrawing money on deposit in financial institutions, are jointly used pursuant to reciprocal alliances between financial institutions and financial industries. On the basis of these alliances, networks have been built for each financial industry. Moreover, these industry-specific networks are interconnected via relay centers. Accordingly, Y2K compliance efforts must be undertaken by (i) each financial institution, (ii) intra-industry networks, and (iii) inter-industry networks.

(2) ATM network connection tests were conducted twice (on April 18 and May 9, 1999) with the participation of all networks. The tests verified that in each network, each industry system is able to process data dated January 4, 2000, and February 29, 2000, without any problem.

(3) In addition, as of June 1999, a crisis management plan had been formulated for each ATM network as a precaution against emergencies.

8. Credit Cards

In Japan, credit cards are valid for a maximum of five years. In 1994, credit card companies began to address the problem of reading credit cards that expired in the year 2000 or thereafter. By June 30, 1996, they had completed their measures to rectify the problem, primarily by replacing card-reading terminals in the stores that accept their cards. Last year, the commenced issuance of cards expiring in or after 2000. To date, no notable trouble has been reported.

(2) By September 30, 1999, each credit card company is expected to complete the entire Y2K compliance process, including remediation of its internal systems and testing of connections to external networks.

9. Elevators

(1) Elevator manufacturers have verified that Y2K problems will not interfere with elevator operation control. In addition, in cases where the year is displayed in elevator lobbies or on monitor panels, the manufacturers verified that elevator operation will be unaffected even if a display malfunction (e.g. the year displayed as 1900) occurs. The display itself can be rectified by resetting the year.

(2) In the case of single elevator installations or two or three elevators whose operation is controlled as a single system, elevator operation control does not use the date, so Y2K problems will not occur.

(3) In the case of three to eight elevators whose operation is controlled as a single system, their operation is controlled by day of the week (not the date), time (24 hour cycle), and use frequency (number of times used during each time period on each day of the week). Hence, operational problems will not occur due to Y2K problems.

10. Building Management

(1) In the building management sector, Y2K compliance efforts are proceeding with respect to control systems (e.g. HVAC equipment, security systems). Most major commercial building owners are proceeding with or have completed system remediation work, including simulation testing.

(2) In the unlikely event that these control systems shut down with respect to some facilities, they can be easily restored to operation. Although no major problems are anticipated to occur, most major commercial building owners are currently formulating or have already formulated crisis management plans as a precaution against emergencies.

11. Electricity

(1) As of June 30, 1999, the simulation testing completion ratio (the average percentage of simulation testing completed by all power companies) for critical control systems was 98.8%. The power companies plan to be 99.4% completed with their Y2K compliance work on these systems by September 30 and 100% completed by November 30.

(2) The power companies have investigated all critical control systems, including their microchip design and programming. The results of the investigation are as follows.

(i) The power companies verified that power outages, voltage irregularities, and other situations that would pose supply or safety problems will not occur because the software and hardware, including microchips, that directly control power supply do not use date information.

(ii) Monitoring and recording functions do use date information and consequently require remediation and other Y2K compliance work, which is scheduled to be completed per the above schedule.

(3) Each power company is providing detailed information via the Internet regarding each power plant's state of Y2K preparedness.

(4) In terms of crisis management, power companies are routinely prepared to respond to natural disasters and other emergencies. To ensure thorough preparedness for Y2K problems, each power company has already formulated a crisis management plan that includes provisions for establishment of a Y2K Task Force, development of communication arrangements, and deployment of additional standby personnel. The power companies intend to continually revise these plans as necessary.

12. Gas

(1) As of June 30, 1999, the major urban gas companies had completed all Y2K compliance work on their critical control systems, with the exception of one system undergoing a hardware upgrade (simulation testing completion ratio: 98.9%). For this remaining system, upgrading and simulation testing is scheduled to be completed by September.

(2) The gas companies have investigated all critical control systems, including their microchip design and programming. The results of the investigation are as follows.

(i) The gas companies verified that there will be no problems with respect to gas supply or safety because the software and hardware, including microchips, that directly control gas production and supply do not use date information.

(ii) Monitoring and recording functions do use date information and they consequently require remediation and other Y2K compliance work, which is scheduled to be completed per the above schedule.

(3) Gas companies providing information via the Internet regarding their state of Y2K preparedness.

(4) In terms of crisis management, gas companies are routinely prepared to respond to natural disasters and other emergencies. To ensure thorough preparedness for Y2K problems, gas companies have already formulated a crisis management plan that includes provisions for establishment of a Y2K Task Force, development of communication arrangements, and deployment of additional standby personnel. The gas companies intend to continually revise these plans as necessary.

13. Oil Imports

(2) According to responses to inquiries from Japanese oil companies and information obtained through diplomatic channels, nearly all of the state-run oil companies and major private oil companies that supply oil to Japan plan to complete the Y2K compliance process during 1999.

(3) Japan has roughly 160 days worth of oil reserves, including both private and national reserves. Hence, even in the unlikely event of a short supply of oil to Japan, Japan will be able to fully cope with the situation through utilization of reserves, among other means.

14. Food

(2) Since ordinary retailers such as produce and fish specialty shops usually do not have POS or EOS systems, they are expected to be only minimally affected by Y2K problems.

15. Water Supply

(2) In most cases, computer operation is not date-controlled. Hence, there will be no interruptions of water service or other situations that interfere with the water supply. In the unlikely event that some facilities do shut down, they can easily be switched to manual operation, resulting in no impediment.

(3) As of June 30, 1999, the simulation testing completion ratio for all water utilities' critical control systems was approximately 90%. The same ratio for other critical systems is nearly 100%. Simulation testing has largely been completed. The systems for which testing has yet to be completed are those unable to be tested yet due to a scheduled hardware replacement or other unavoidable circumstances. In addition, water utilities are proceeding to formulate crisis management plans as a precaution against emergencies.

16. Sewerage

(2) In most cases, computer operation is not date-controlled. Hence, Y2K problems will not interfere with sewage treatment or other operations. In the unlikely event that some facilities do shut down, they can easily be switched to manual operation, resulting in no impediment.

(3) Sewage system operators throughout Japan are currently identifying and rectifying problems in the interest of ensuring thorough Y2K compliance.
In addition, the Ministry of Construction has requested that they formulate a crisis management plan by September as a precaution against emergencies.

17. Newspapers

(2) The Japan Newspaper Publishers & Editors Association is also striving to ensure thorough Y2K compliance. For instance, it is meeting with executives of newspaper companies, exchanging information through surveys and organ publications and, as necessary, consulting with newspaper production equipment suppliers and communication line owners.

18. Insurance Coverage

(2) At the same time, there are insurance policies that protect against all losses related to the insured's computers, as well as other types of insurance that entail the possibility of massive losses due to Y2K problems. Accordingly, insurers are taking appropriate precautions in response to individual circumstances based on the judgment of their management. For instance, when issuing a non-life insurance policy to a company, after adequately assessing the insurance risk, insurers may append the policy with a rider that limits the insurer's liability for incidents attributable to Y2K problems. Or they may take other such action on a case-by-case basis in accordance with the types of risks involved and the insured's state of Y2K preparedness.

(3) The Marine and Fire Insurance Association of Japan is publishing and distributing pamphlets to promote corporate Y2K preparedness. It is also conducting a publicity campaign aimed at the mass media that incorporates the message that not all losses stemming from Y2K problems are covered by non-life insurance.

State of Y2K Compliance of Everyday Products, etc.

July 1999

Item; State of Y2K Compliance; Compliance Method, etc.

1. Household Electric Products

(1) Air conditioners, refrigerators, washing machines, and other appliances Y2K problems will not occur.

Although some products are timer-controlled or have other time-control functions, time is controlled on a 24-hour basis. Hence, no action is necessary.

(2) Audio-visual equipment

Less than 5% of the VCRs, TVs, and video cameras made by only 4 of 21 manufacturers are subject to Y2K problems.

The problems that will occur are inability to program VCRs to record using G-codes, erroneous day-of-week display, and leap year problems.

The 4 companies have made information available via the Internet and are have set up toll-free numbers to handle customer inquiries.

(3) Facsimile machines

In most cases, malfunctions will be limited to erroneous display. Most of the problematic products were shipped prior to 1997.

Most problems can be rectified by resetting the date. A small minority of models require ROM replacement.

All concerned companies are making information available on their Web sites regarding problematic models and the procedure for rectifying problems when they occur.

2. Telephony

(1) Telephones

Two manufacturers' home telephones will experience display malfunctions if proper steps are not taken with respect to the fact that 2000 is a leap year, but the communication function itself will not be affected.

Users can rectify the problem by manually resetting the display.

(2) Mobile telephones

Out of 40 manufacturers, the products of 3 mobile telephone manufacturers, 1 PHS manufacturer, and 1 wireless pager manufacturer will experience problems such as erroneous date display, but the communication function itself will not be affected.

In some cases, users can rectify the problem by manually resetting the display. All manufacturers except one (which is currently studying the problem) have published rectification procedures via the Internet.

(3) Telephone service

By September 1999, the major telecom carriers plan to be 100% completed with the Y2K compliance process for their telephone lines, leased lines, and other critical communication systems.

By September 30, 99.2% of telecom carriers plan to formulate crisis management plans.

3. Internet

(1) Networks

It is deemed to be very unlikely that Y2K problems will significantly interfere with the Internet's basic communication function. Nonetheless, since administrative functions and add-on functions based on mail storage and user administration do process information that includes the year, Y2K compliance measures are required on a case-by-case basis.

Problems can be rectified by using remediation tools provided by manufacturers, among other means.

(2) Internet Service Providers (ISPs)

As of June 30, 1999, the major ISPs had nearly completed the Y2K compliance process. They plan to complete the entire process by September 30.

ISPs are providing information via the Internet about the state of their Y2K preparedness.

(3) User Systems

Same as personal computers (see below).

Same as personal computers.

4. Cable TV

(1) Cable TV broadcasters that retransmit broadcast programming

Since this type of broadcasting does not entail processing of year data, it is deemed to be fundamentally problem-free.

(1) Cable TV broadcasters that broadcast independent programming

There are concerns that systems for automatic transmission of broadcast programming may be affected, but the Y2K compliance process for these systems is already largely completed.

Broadcasters that have not yet formulated a crisis management plan will be instructed (*by who?) to do so by September 30.

5. Personal Computers

(1) Hardware and OS

The BIOS of products shipped in recent years (generally since 1996-97) will not experience Y2K problems.

Earlier products require remediation, but the procedure is simple.

The OS basically depends on the BIOS's state of Y2K compliance.

Problems can be rectified by manual resetting, etc.

Users can check about specific model's status and compliance procedures through the manufacturer's Web site.

(2) Application Software

The latest versions are generally Y2K compliant.

There is possibility of slight malfunctions of date display or other functions. It is necessary to check with manufacturers regarding remediation measures for specific products.

Normally, users can rectify problems by changing input methods, using remediation tools provided by the manufacturer, etc.

6. Passenger vehicles and related equipment

(1) Passenger vehicles

No problems.

All auto makers have completed final verification and released a safety statement.

(2) Navigation systems

Eleven of 18 manufactures responded that their products are problem-free. The other 7 manufacturers responded that some of their products will malfunction.

The companies that responded that some of their products will malfunction are notifying users individually and providing information via the Internet, press releases, etc.

(3) Traffic signals

By September 1999, remediation work is scheduled to be completed on over 93% of the traffic signals linked to traffic control centers.

Since traffic signals are designed to ensure that the light is never simultaneously green in all directions of an intersection, traffic collisions will not occur due to signal malfunction.

Some older signals require ROM replacement.

(4) Fire trucks and ambulances

100% of fire departments have completed required remediation work or verified that no remediation work is needed.

7. Automatic teller machines

Crisis management plans have been formulated as a precaution against emergencies.

8. Credit cards

By September 1999, credit card companies will complete the entire Y2K compliance process, including remediation of in-house systems and external network connection testing.

9. Elevators

Erroneous displays can be rectified by resetting the date.

10. Building management

In the unlikely event that some equipment shuts down, operation can easily be restored.

Each company is formulating a crisis management plan as a precaution against emergencies.

11. Electricity

As a precaution against emergencies, power companies have already formulated crisis management plans that include provisions for establishment of Y2K Task Forces, development of communication arrangements, and deployment of additional standby personnel. They intend to continually revise these plans as needed.

12. Gas

As a precaution against emergencies, gas companies have already formulated crisis management plans that include provisions for establishment of Y2K Task Forces, development of communication arrangements, and deployment of additional standby personnel. They intend to continually revise these plans as needed.

13. Oil Imports

According to information obtained to date, nearly all of the state-run and major oil companies that supply oil to Japan plan to complete the Y2K compliance process during 1999.

Even in the unlikely event of a short supply of oil to Japan, Japan will be able to cope through such means as utilization of its approximately 160 days worth of oil reserves, including both national and private stockpiles.

14. Food

Since most specialty retailers do not have POS or other such systems, the are expected to be largely unaffected by Y2K.

Each company has started to formulate a crisis management plan as a precaution against emergencies.

Companies plan to hold explanatory meeting for suppliers and conduct simulation testing for data exchange.

15. Water supply

In the unlikely event that some facilities do shut down, they can easily be switched to manual operation.

Each water utility is formulating a crisis management plan as a precaution against emergencies.

16. Sewerage

In the unlikely event that some facilities do shut down, they can easily be switched to manual operation.

Each sewage system operator is formulating a crisis management plan as a precaution against emergencies.

17. Newspapers

Most newspaper companies are planning to conduct final tests on a newspaper holiday in autumn.

18. Insurance Coverage

For corporate non-life insurance for specific companies, insurers are taking appropriate precautions in response to individual circumstances based on the judgment of their management. For instance, they may append policies with a rider limiting their liability for incidents stemming from Y2K problems, after adequately assessing the insurance risk; or they take other such action on a case-by-case basis in accordance with the types of risks involved and the insured's state of Y2K preparedness.

The Marine and Fire Insurance Association of Japan is publishing and distributing pamphlets to promote corporate Y2K preparedness.