program makes it impossible to fund allchanges internally. There is typically arange of potential solutions for a givenequipment set, reflecting individual cus-tomer characteristics and preferences,and necessitating the customer’s involve-ment in determining the appropriate solu-tion set. Costs are determined by whichsolutions are chosen and, very significant-ly, by whether the system is covered bycontract or warranty. For billable cus-tomers, how current their system configu-rations are would drive costs as well.KLA-Tencor’s policy is not to treat Year2000 as a revenue enhancement oppor-tunity. We expect Y2K revenues will onlypartially offset our program costs.

Q Will KLA-Tencor’s internalsystems be ready as well?

A The company has assigned dozensof people to inventory, evaluate, andremediate our internal business systemsand tooling. Activities are well along inall these areas. We anticipate completionof these activities, as well as evaluationof our suppliers by mid year.

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Spring 1999 Yield Management Solutions 49

AQQ What is KLA-Tencor doing toaddress the Y2K issue?

A KLA-Tencor has a Year 2000 readi-ness project team and program wellunder way to identify and address all ofthe main areas of concern: KLA-Tencoryield management systems, internal busi-ness systems and services, internal net-working and tooling, and critical suppli-ers. Each product group has an assignedY2K product owner to coordinate anddrive the product-specific Y2K issues, andto work closely with the Y2K programteam. Senior management is closely monitoring the program to ensure that it receives the appropriate priority andresources.

Q What is KLA-Tencor doing tomake its products Y2K ready?

A Through our participation in theSEMATECH Year 2000 ReadinessSupplier Survey, we have evaluated allour current products with the SEMATECHrecommended version 2.0 test scenarios.The results are reported in KLA-Tencor'sProduct Readiness Matrix, which is avail-able to customers through KLA-Tencorsales and service personnel. In addition,C and C++ code have been inspectedfor date-related code. BIOS, embedded

processors, operating systems and thirdparty software have also been evaluated.

Q How many KLA-Tencor toolsare affected by Y2K?

A Because KLA-Tencor’s worldwideinstalled base is approximately 17,000,including retired systems and productsthat are no longer sold, the companyfaces a substantial challenge in address-ing the Y2K issue. While many of ourproducts are not affected by Y2K and many customers are not electingto upgrade all tools, we estimate thatbetween 8,000 and 9,000 tools will beupgraded by the program’s completion.Field audits, where service engineersdetermine the product hardware and soft-ware configurations, enter that informationinto our Y2K database and generate rec-ommended Y2K upgrades, will be sub-stantially complete by the time this articleis published. Where product obsoles-cence or other issues prevent KLA-Tencorfrom providing Y2K support, customersare being notified.

Q Will there be charges forthese Y2K upgrades?

A As companies in every industry arediscovering, the magnitude of the Y2K

Answers to your questions about KLA-Tencor and the Year 2000 issue.

S E C T I O N S

For more information contact your localaccount team or representative forproduct status, availability and pricingof Y2K upgrades.

KLA-Tencor takes the Y2K issue very seriously from both a product readiness and business continuity perspective. We understand the

magnitude of this issue for our customers and for our business. We are committed to doing everything we can to ensure a successful transition to and through the Year 2000.