It was thought computer programs could stop working or produce erroneous results because they stored years with only two digits and that the year 2000 would be represented by '00' and would not follow 1999 (i.e., '99') in numerical sequence. This would cause date comparisions to produce incorrect results.
Y2K was the common slang for the year 2000 problem. It also went by Millennium Bug (though, strictly speaking, 2000 is the last year of the 20th century and does not start a new millennium).
The underlying programming problem was quite real. In the 1960s, computer memory and storage were scarce and expensive, and most data processing was done on [punch cards]? which represented text data in 80-column records. Programming languages of the time, such as COBOL and RPG?, processed numbers in their ASCII or EBCDIC representations. They occasionally used an extra bit called a "zone punch" to save one character for a minus sign on a negative number, or compressed two digits into one byte in a form called [binary-coded decimal]?, but otherwise processed numbers as straight text. Over time the punch cards were converted to magnetic tape and then disk files and later to simple databases like ISAM?, but the structure of the programs usually changed very little. Popular software like dBase? continued the practice of storing dates as text well into the 1980s and 1990s.
Saving two characters for every date field was a significant savings at that time. Most programmers of that day did not expect their programs to remain in use for many decades, so it was not considered a significant problem. Programmers started recognizing it as a looming problem in the 1980s, but inertia and apathy caused it to be mostly ignored.
Storage of a combined date and time within a fixed binary field is often considered a solution, but the possibility for software to mis-interpret dates remains, because such date and time representations must be relative to a defined origin. Roll-over of such systems is still a problem but can happen at varying dates and can fail in various ways. For example:
Another related problem for the year 2000 was that it was a leap year even though years ending in '00' are normally not leap years. (A year is a leap year if it is divisible by 4 unless it is both divisible by 100 and not divsible by 400.)
Some industries started experiencing related problems early in the 1990s as software began to process future dates past 1999. For example, in 1993, some people with financial loans that were due in 2000 received (incorrect) notices that they were 93 years past due. As the decade progressed, more and more companies experienced problems and lost money due to erroneous date data. As another example, meat-processing companies incorrectly destroyed large amounts of good meat because the computerized inventory system identified the meat as expired.
As the decade progressed, identifying and correcting or replacing affected computer systems or computerized devices became the major focus of information technology departments in most large companies and organizations. Millions of lines of programming code were reviewed and fixed during this period. Many corporations replaced major software systems with completely new ones that did not have the date processing problems.
Y2K was the big media hype story of 1999. Public apprehension was tremendous, reaching mythical proportions. Some individuals stockpiled canned food in anticipation of food shortages. Some extreme commentators predicted a full-scale apocalypse?. But when January 1, 2000 finally came, there were hardly any major problems, though a large number of them had been expected. Ironically, many people were upset that there appeared to be so much hype over nothing, because the vast majority of problems had been fixed correctly. Some more sophisticated critics have suggested that much preventative effort was unnecessary -- it would have been cheaper not to spend as much examining non-critical systems for flaws and simply fix the few that would have failed after the event. Such conclusions are easy to draw with the benefit of hindsight, but in any case the overhaul of many systems involved replacement with new, improved functionality anyway and thus in many cases the expenditure proved useful regardless.
Some items of interest:
See also: conspiracy theory, New World Order, predicted terrorist incidents that did not materialize.