a/d trends: AD Predictions for the Year Ahead

It looks like 1999 will be a year like no other in IT terms. I’m thinking especially of the now overly documented Year 2000 bug.

Question: Which market sector is going to make the most money from the dreaded Y2K?

Will hardware vendors have a field day? Sure they will. Vendors of PCs, NT servers, Unix and IBM systems will all do well. Customers will scramble to replace aging PCs, mainframes and midrange computers, particularly those not officially Year 2000 compliant.

But, did you know that according to vendor marketing information, 1999 could well be a “reverse” year. Customers may frantically buy equipment in the first and second quarters, then settle down with hardware acquisitions to levels traditionally associated with first and second quarter activities in the third and fourth quarters.

This makes sense. A significant number of customers also say they plan to either freeze or defer solutions development and deployment in the second half of next year. Distributors are actively foregoing the traditional January and February junkets to Florida, Arizona and Hawaii to cover conferences, clubs and education, and are focusing on doing selling. They’ve decided leisure can wait until October and November.

Will Y2K tool vendors have a field day? Indicators are that this market is so diverse – a patchwork of so many micro-niche products that confusion will prevail – so no single vendor can bank on any kind of picnic.

Searching just the official IBM Partners in Development Year 2000 Tool list at http://www.softmall.ibm.com/as400/year2000/solutions/y2ktol.html reveals close to 70 listings.

Furthermore, most people looking for Year 2000 tools in 1999 are looking too late – they will have to perform much more radical IT intrusions. Many of these tools will probably be oversold by now (customers really should pay more attention to the fine print than to the ad slogans).

Businesses who made no IT planning efforts in 1998 will not be rewarded with the magic pill in 1999. Maybe people have gambled with their companies’ IT systems’ Year 2000 compliance. Unfortunately, some of those bets just won’t pay off.

Will service providers win? Many individuals – COBOL programmers and the like – are either emerging from early retirement or planning on taking one. They likely will have a great year – probably a record year. They’ll make just enough to cap off their retirement savings, buy the new Volvo and finish their renovations on the cottage.

But for the service industry as a whole, there are many risks. It’s hard to establish just how much profit will be tied to the Year 2000.

First, the skills required are fixed commodities – there isn’t time to groom or train legions of new programmers. Second, service providers are concerned about “bubble” effects, being careful to build large infrastructures and overhead for the undeniable fact that the work will, at some point be done.

Then there is the “backlog” work, which will be accumulated during the Year 2000 project cycle. Or is there? The services sector will probably have a record year – not directly because of Year 2000 practices, (i.e. systematically changing and updating legacy applications), but rather tangentially related to Year 2000, (upgrade services, ERP installations, BI solutions, etc).

Most professional application developers will be profoundly impacted by this trend. The key message here is: If you’re not planning to switch from RPG, plan to retire by 2002.

Will AD tool vendors make all the money? Maybe, but they shouldn’t spend it all in once place.

Vendors of legacy compilers and tools will probably have their swan song in 1999. Demand will be high for traditional compilers of all sorts on all kinds of machines. There will be an even higher market demand for development environments that support redevelopment of code.

If products like CODE/400 or ADTS were going to have a record year, I figure it will be 1999. Customers checking, pruning, re-integrating, updating, converting, porting, debugging, reverse engineering or otherwise manipulating their legacy code will find programmer productivity increases. Legacy tool vendors will hopefully invest their 1999 booty wisely into other areas. This phenomenon will happen only once.

Year 2000 will intensify the search for new development technologies and make more and more people consider their AD futures. Will it be Java? Will it be Lotus? Will it be Microsoft? No winner will emerge just yet, but the battle looks increasingly interesting.

Many people I’ve talked to have said, “If only IBM would have had San Francisco evolved two years faster, it would have been perfect timing and a perfect Year 2000 solution.”

Mark Buchner is president and founder of Astech Solutions Inc. (Aurora, Ontario), which applies technology to the practical needs of the AS/400 market. mbuchner@astech.com