In the early 1980's, common hard drives had a maximum capacity of 10 Megabytes. These hardware limitations were reflected in operating systems. When the original operating system for the IBM-PC, DOS, was developed, the maximum amount of semiconductor memory was set at 0.64 Megabyte. In the mid-1980's, DOS version 3.3 did not allow disk volumes larger than 32 Megabytes. But this saving of memory doesn't make sense.
Computers routinely work with binary representations of numbers.
The impending disaster on 1 Jan 2000 is not the only problem. For example, that date might be interpreted as a default, nonsense date. So, when users input 9 Sep 1999, the computer program will refuse to accept it as a valid date. After that date, computer programs will allow archival tapes to be overwritten, with permanent loss of valuable data. Aside from this problem that is specific to IBM-mainframe computers, I worry about backup software in general.