Year 2000 Spotlight Turns to FCC, Telecom Industry

Year 2000 Spotlight Turns to FCC, Telecom Industry

By Richard McCaffery
Staff Writer

Federal Communications Commission efforts to ensure the telecommunications industry is tackling year 2000 software problems and sharing vital information with its customers are getting the spotlight from industry and members of Congress.

A growing chorus of criticism from congressional and industry officials that the FCC is falling short in its efforts has been met with stepped up activities by the agency.

"My overall concern is whether or not there is a proper level of management attention being paid to this, not only at the FCC, but in the telecommunications industry," Sen. Robert Bennett, R-Utah, told Washington Technology last week.

William Kennard

FCC Commissioner Michael Powell and FCC Chairman William Kennard sent letters to key telecommunication companies in late April asking them to commit to testing dates and update the public on year 2000 progress.

Many of the letters, sent to over 100 companies in different sectors of the industry, asks for a reply in 30 days. Congressional hearings on the issue also are being planned. In addition, the agency also formed a year 2000 task force in late March.

But skeptics want agency officials to move even faster.

"What I sense the [FCC] is going to do is jawbone," said Jim Devlin, director of New York-based Citibank's year 2000 enterprise project. "We don't think it's going to move things fast enough, and we'll continue to work on that."

Banking officials recently pulled the alarm on the telecommunications industry, claiming banks will have to delay testing critical computer systems by about six months because some of the major telephone companies will not have finished fixing their systems before next year.

Devlin said that despite increased efforts at the FCC to address year 2000 issues, officials at the second-largest bank in the United States are still worried.

He confirmed Citibank will delay some testing while its carriers repair their computer systems, but he declined to name those telecom companies.

"We're going to be behind the curve," Devlin said.

Both Powell and Kennard have expressed concerns recently over the telecommunication industry's reluctance to share information such as details of their year 2000 progress and testing dates.

"We don't have the full degree of forthcoming we would like," said Powell, who represents the FCC on President Clinton's Year 2000 Council. Formed in February, the council coordinates efforts among agencies, raises awareness of the issue and performs outreach work with the private sector.

Powell said the FCC's oversight job is more limited than the Federal Reserve System's authority to oversee the banking industry. However, the agency wants to make sure there is a dial tone Jan. 1, 2000.

"We've ramped up pretty much to full speed now," he said. "We're about to go into high gear. But this isn't going to be accomplished by administrative fiat. The FCC does not have the ability to walk into every phone company and inspect 1,600 switches," Powell said in an interview last week.

The widespread year 2000 problem stems from the early days of computers when programmers saved space by dropping the first two digits from date codes. The problem comes at the turn of the century when computers interpret "00" as "1900." Fallout from computers that fail to recognize 2000 could range from rejected credit cards to widespread system crashes.

The FCC has to walk the line between encouragement and enforcement in dealing with telecommunications companies, Powell said.

"If you turn this into a formalistic process, then it becomes an issue for the lawyers," he said. "But we are not gun-shy. If people are not playing the game, our first loyalty is to the American public."

Citibank's Devlin said he would like the FCC to do more than motivate.

"We've met with commissioners at the FCC, and it's bearing some fruit," he said. "I don't think it's going to be enough. The short answer is we would like them to do more, though I'm not sure they can."

Devlin said he would like to see some specifics from major telephone companies, such as contingency plans in the event of failures, and a focus on fixing major switches by prescribed dates. "We still have a high level of concern," he said.

Meanwhile, telecom executives expressed confidence they will be ready.

New York-based Bell Atlantic is spending between $200 million and $300 million to fix its systems and expects to complete year 2000 repairs by July 1999, said Skip Patterson, executive director of Bell Atlantic's year 2000 program office.

"The stake we've put in the ground is July 1, 1999," Patterson said. Bell Atlantic has met frequently with federal regulators and made "significant disclosures," he said. "We're being forthright. We're putting the maximum information out that we can."

The company has a year 2000 Web page that it updates regularly, Patterson said. But Bell Atlantic has drawn the line when it comes to releasing specific information about progress milestones, testing timetables and other material it considers proprietary.

"If you make [that information] public, you're inviting people in to micromanage," he said. "There's not time."

Patterson said last week Bell Atlantic had received the FCC letter. "We, along with many other competitors, are in the process of responding to it," he said. He declined to comment further.

While the problem is bigger than Bell Atlantic originally thought, it is not overwhelming, Patterson said. The company started addressing the issue in 1994.

"We're taking a pragmatic approach," he said. "We don't think it's Armageddon, but we think it's a lot more than nothing. ... It's critical to survival."

Rep. Steve Horn, R-Calif., the most visible lawmaker on the year 2000 issue, has asked FCC officials to testify at a hearing in June. A date for the hearing has not been set.

"We anticipate exploring the year 2000 issue with the agency at that time," Matthew Phillips, Horn's spokesman, said last week. "We'll know a lot more about it then."

Rep. Tom Davis, R-Va., said the FCC situation is symptomatic of the federal government's overall year 2000 problem. "With just about every agency, they aren't doing enough and are way behind the curve," he told an information technology conference last week hosted by Federal Sources Inc., McLean, Va.