devices and chips receive erroneous or improper data from third-parties
suffering from the year 2000 problem. In addition, two interacting systems,
applications, devices or chips, each of which has individually been fixed so
that it will properly handle the year 2000 problem, could nonetheless result in
a failure because their method of dealing with the problem is not compatible.
These problems are expected to increase in frequency and severity as the
year 2000 approaches. This issue impacts our owned or licensed computer systems
and equipment used in connection with internal operations, including:
- information processing and financial reporting systems;
- customer billing systems;
- customer service systems;
- telecommunication transmission and reception systems; and
- facility systems.
THIRD PARTIES. We also rely directly and indirectly, in the regular course
of business, on the proper operation and compatibility of third party systems.
The year 2000 problem could cause these systems to fail, err, or become
incompatible with our systems.
If we or a significant third party on which we rely fails to become year
2000 ready, or if the year 2000 problem causes our systems to become internally
incompatible or incompatible with such third party systems, our business could
suffer from material disruptions, including the inability to process
transactions, send invoices, accept customer orders or provide customers with
our cable services. We could also face similar disruptions if the year 2000
problem causes general widespread problems or an economic crisis. We cannot now
estimate the extent of these potential disruptions.
STATE OF READINESS. We are addressing the Year 2000 problem with respect
to our internal operations in three stages:
(1) conducting an inventory and evaluation of our systems, components, and
other significant infrastructure to identify those elements that
reasonably could be expected to be affected by the year 2000 problems.
This initiative has been completed;
(2) remediating or replacing equipment that will fail to operate properly
in the year 2000. We plan to be finished with the remediation by
September 1999; and
(3) testing of the remediation and replacement conducted in stage two. We
plan to complete all testing by September 1999.
Much of our assessment efforts in stage one have involved, and depend on,
inquiries to third party service providers, who are the suppliers and vendors of
various parts or components of our systems. Certain of these third parties that
have certified the readiness of their products will not certify their
interoperability within our fully integrated systems. We cannot assure you that
these technologies of third parties, on which we rely, will be year 2000 ready
or timely converted into year 2000 compliant systems compatible with our
systems. Moreover, because a full test of our systems, on an integrated basis,
would require a complete shut down of our operations, it is not practicable to
conduct such testing. However, we are utilizing a third party, in cooperation
with other cable operators, to test a "mock-up" of our major billing and plant
components, including pay-per-view systems, as an integrated system. We are
utilizing another third party to also conduct comprehensive testing on our
advertising related scheduling and billing systems. In addition, we are
evaluating the potential impact of third party failure and integration failure
on our systems.