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January 4, 1999
Web Gridlock Minimal Web commerce sites held up remarkably well under peak holiday loads. By one measure, the top Internet shopping sites performed better than most business Web sites during the week before Christmas. "Sites strongly focused on retail consumers seem to have done an excellent job of preparing for the holiday shopping season," says Umang Gupta, CEO of Keynote Systems Inc., which measures Web site performance. On Dec. 17, for instance, Amazon.com delivered its home page in an average of 4.9 seconds and was available 99.4% of the time a page was requested, Keynote found. Those figures beat the industry average of 9.2 seconds and 97.5% availability, based on the performance of 40 business Web sites, including those of Federal Express, Microsoft, and Charles Schwab. On the same day, Barnesandnoble.com delivered its home page in 7.3 seconds and was available 99.2% of the time. Two days earlier, the site slowed down for several hours because of an overwhelming number of users creating new accounts as well as a corrupt account index. For other retail sites, old-fashioned fulfillment was a bigger problem than Web server performance. Shopping.com sent E-mail to customers saying shipments during the holiday season might take longer to fulfill than the promised two weeks, due to order volume. Y2K Gums Up Banks Year 2000 preparations are crimping the plans of financial institutions. Merrill Lynch & Co. says it will delay its rollout of online trading for a second time because of year 2000 and euro initiatives, and the Federal Reserve Board is proposing that banks be given more time to finalize their mergers so they can concentrate on year 2000 work. Merrill Lynch had planned to introduce online trading for some of its customers last spring but then delayed it until December to focus on year 2000 and European monetary union projects. Online trading has been postponed until sometime in the first quarter, a Merrill Lynch spokeswoman says. "We have up to 2,500 people working on year 2000 and the EMU at any time, and those were the priorities for this year," the spokeswoman says. Meanwhile, the Fed has proposed that the usual one-year transition period be extended for banks that are merging between July 1998 and May 1999; this would make it easier for them to complete their year 2000 projects. The banks would have until June 1, 2000, to begin operations as a single entity. Airlines Outsource Korean Air signed a 10-year, $120 million outsourcing deal late last month with IBM Global Services to manage the airline's data centers and develop a new IT infrastructure to reduce costs and improve customer service. The two expect to enter into a second contract, for an Internet-enabled global network, later this month. The deal follows two recent airline outsourcing wins by the Sabre Group Inc. Last month, Sabre signed a 15-year contract with Pakistan International Airlines for year 2000 assessment, new applications, and operations management for an undisclosed sum. Before that, Aerolineas Argentinas awarded Sabre a similar 10-year outsourcing contract, worth $120 million. Earlier last year, Southwest Airlines extended a 10-year relationship with Sabre by awarding it a five-year, $64 million deal to manage reservations and inventory systems, as well as year 2000 work. Year 2000 concerns are likely to motivate more airlines to secure outsourcing services this year, says Dataquest analyst Allie Young. But airlines also want help with new scheduling technologies, as well as data mining systems that will let them exploit their wealth of frequent-flier information.  Digital offered infrastructure work; Compaq will do ERP implementation. Read I.T. Confidential 
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