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Chip Shortage Delays Routers for Broadband ISPs and Networks

Friday, April 9th, 2021 (11:30 am) - Score 4,584
Network cable connected to wifi router on white background.

The ongoing global shortage of semiconductor chips, which has so far hit everything from electric cars to graphics cards, is reportedly also causing huge delays in the market for broadband ISP and network routers. The situation could make it harder for providers to add new customers, replace faulty kit or launch new products.

The situation began last year following the first COVID-19 lockdown, which slowed production. Since then, the problem has also been exasperated by further lockdowns, as well as a semiconductor plant fire in Japan, disruption to trade caused by last week’s blocking of the Suez Canal in Egypt, prioritisation being given to Smartphone makers and the sudden rise in demand that followed the easing of earlier lockdowns.

The head of European regional business for Zyxel Communications Corp – a Taiwan-based router-maker that is also used by some UK providers and consumers, Karsten Gewecke, is quoted by Bloomberg as saying they have “been very close several times” to running out, and he warned that “it could still happen.”

At the start of this year Zyxel began asking customers to place orders for new routers a full year in advance to help mitigate the long supply times. As if that wasn’t bad enough, a number of the major semiconductor firms and analysts have warned that the situation may not return to normal until toward the end of 2021, or possibly even into 2022.

Karsten Gewecke said:

“It’s a snowball effect that we’re pushing in front of us, and the situation since then has just become worse and worse and worse. When I talk to some of the chipset vendors, some of them tell me that they have something like overbooking of 300% of their capacity.”

One other catch with all this is that demand outstripping supply tends to result in higher product prices, which is something that has already been seen with computer graphics cards (some new models have doubled or even tripled in price).

We had been expecting one or two major UK ISPs to potentially launch new routers and TV set-top-boxes this year, but given this news it’s possible that the ongoing supply problems may impact those plans. However, so far we haven’t heard much concern from broadband ISPs with respect to consumer facing devices, but this may be partly because they’re still eating through existing stock.

Leave a Comment
17 Responses
  1. Avatar Wayne says:

    “or possibly even into 2020.” – time travel is possible!

  2. Avatar Winston Smith says:

    It’s only really a shortage of sub 10 nanometre process chips. Only TSMC and Samsung seem to be able to manufacture these reliably and it’s TSMC that has the large backlog.

    1. Avatar JP says:

      I think what the providers are saying is they won’t pay the inflated pricing for chips, which is fair.

    2. Avatar CarlT says:

      TSMC’s fabs across the board are busy.

      Home routers aren’t using a 10 nm process. They can afford the extra power and cooling requirements from cheaper fabrication processes.

      You can likely find out which chipset is in a router and from there the fabrication process being used. 10 and 7 nm are huge overkill given the demand for them in phones, GPUs, APUs, CPUs, etc.

      Don’t need to cram gazillions of transistors into a home router

  3. Avatar JP says:

    Well ISP’s got enough kit already in circulation, they should be recycling stuff, ISP’s are a bit too wasteful me thinks.

    1. Mark Jackson Mark Jackson says:

      To be fair some of them do, such as BT, but modern electronic kit does tend to wear out over time, so you can only recycle the same hardware so often.

    2. Avatar JP says:

      Fair enough I suppose, surely there is a way to refurbish kit though, I mean its not like the technology for most connections has really changed yet (ie. xDSL kit/Ethernet)

    3. Avatar 125us says:

      There’s an ever-growing need for more storage and processing power to be able to handle the newest Wi-fi standards and for security. Consumer routers do tend to become more energy efficient with each generation though and the lifetime power consumption of a device that tends to run 24/7 is important.

  4. Avatar Frank says:

    Such a shame nearly every ISP sends out a router at “no cost” to new customers. So much e-waste. Buy your own decent router and use an ISP that gives you a discount for using your own – there, that’s two problems solved!

  5. Avatar Bob2002 says:

    Possibly it’s my imagination but homebrew routers seem to be getting more popular. You can buy fanless Celeron/Atom mini-PCs on eBay(and elsewhere) for around £150-£200 and load pfSense/OPNsense/Vyos etc on them. My current router is Untangle on a passively cooled(35W TDP – Artic Alpine AM4 Passive cooler) AMD Ryzen 3 PRO 3200GE. Also x86/64 CPUs with crypto-acceleration seem to deliver much better VPN performance than a bog standard ARM router …

    1. Avatar MikeyMole says:

      I’ve done something very similar. I paid a fair amount for a protectlivault 4 port firewall and installed pfsense on it, put my VM Hub3 into modem mode and I’ve never looked back!

      Self build is amazing for performance and stability if you can be bothered 🙂

      I remember the days where every so often i’d have to restart the hub to make it work again. Those days are gone – if the ISP goes down, I go down, but otherwise no issues whatsoever my side of the equation.

    2. Avatar Bob2002 says:

      @MikeyMole

      I’ve heard that many pfSense users are a bit unhappy about their future direction – pfSense Community Edition etc(and also about the WireGuard and OPNsense behaviour – https://en.wikipedia.org/wiki/PfSense ). But I guess it’s not a problem as OPNsense is similar, popular, and free.

      In my case some users were upset at the newish Untangle licensing, think they used to have one home licence at $50/year, now the options for home users are – free, Home Protect Basic($50) and Home Protect Plus($150). I’m happy to pay $50/year for a licence but if it edges too close to $100 or drops features I’ll probably end up running something else.

  6. Avatar Arbortheus says:

    One can only hope it infinitely delays the Virgin Superhubs with Puma chipsets

    1. Avatar MikeyMole says:

      I hope not cos that will likely delay the roll out of their DOCSIS 3.1 and eventual AQM on the upstream.

      I use the Hub3 in modem mode and it’s fine, very stable and no latency issues, so I’m thinking the hub4 should be fine too. Guess we’ll see of course.

      Definitely crap in router mode tho, wouldn’t dream of actually using VM kit as a router.

  7. Avatar Jonathan M says:

    Will end-customers have to wait long? I took out last year’s NOWTV deal for two households in my family, for £15 a month after rebates but it’s due to go up to £40 in June or so, after removal of introductory discounts. Not being able to switch to a new provider could be hugely costly.

    1. Avatar NE555 says:

      I think it’s highly unlikely that all ISPs will simultaneously say “sorry, we can’t accept you as a customer, because we don’t have any router we can send you”. They have huge incentives *not* to turn away business.

      Right now, as Mark said, they have router stocks they’re working through. If eventually they get low on their preferred vendor and model, they’ll choose something else.

  8. Avatar Anthony Goodman says:

    Most ISP bundled routers you wouldn’t want to touch with a bargepole. This should be a good reason to incentivise use of your own routers or incentivise ISPs allowing any router to be used with any ISP.

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