In 2000, the U.S. Navy decided to outsource the management and maintenance of its computer systems to EDS. This huge contract, worth $6.9 billion over five years, is now behind schedule and has been revised to cost $8.8 billion over seven years. Still, the Navy is saving over a billion bucks a year, but EDS has lost over $300 million on the contract in the last three months. What is going on here? Put simply, the Navy did the right thing bringing in outsiders, and the outsiders (EDS) underestimated the scope of the problems confronting the Navy and Marine Corps use of PCs. There are 365,000 "seats" involved (roughly the same number of computers.) What EDS neglected to discover before they bid on the contract was that there were still a lot of Navy and Marine Corps organizations using older DOS programs that would not run on the new standards Windows 2000. EDS discovered over 100,000 programs, some of them several decades old and running on some really ancient iron, that they had to deal with. These "unauthorized" programs had been introduced over the years by sailors and marines to get their jobs done, but were never officially recognized. Many were created by the sailors and marines, and it quickly became apparent that this software could not simply be tossed without causing a breakdown in many crucial functions. Windows 2000 programs have to be found to do the work of these ancient applications, and EDS figures that in several years it will have reduced the number of illegal "legacy" programs to about 2,000. The EDS plan is to get all Navy PCs running Windows 2000 so that networking will be easier and more complete. But in the meantime, many Navy and Marine Corps users have two PCs, an older one running an essential DOS program, and a new one running Windows 2000.