{"id":27959,"date":"2021-08-07T00:01:05","date_gmt":"2021-08-06T23:01:05","guid":{"rendered":"https:\/\/www.ispreview.co.uk\/?p=27959"},"modified":"2021-08-10T09:47:13","modified_gmt":"2021-08-10T08:47:13","slug":"global-chip-shortage-continuing-to-impact-uk-broadband-isps","status":"publish","type":"post","link":"https:\/\/www.ispreview.co.uk\/index.php\/2021\/08\/global-chip-shortage-continuing-to-impact-uk-broadband-isps.html","title":{"rendered":"Global Chip Shortage Continuing to Impact UK Broadband ISPs"},"content":{"rendered":"

Back in the early spring, we reported<\/a> on how the global shortage of semiconductor chips was causing huge delays in the market for broadband ISP network kit (e.g. routers), which could make it harder for providers to add new customers, replace faulty kit or launch new products. Bad news, it’s still a big problem.<\/p>\n

The original situation – flowing from a general rise in demand – was exasperated by a series of major events, not least of which has been the huge disruption caused by the ongoing global COVID-19<\/strong> pandemic, which slowed production (factory closures, staffing issues etc.). On top of that there was a major fire at a key semiconductor plant in Japan and then a large ship (‘Ever Given<\/em>‘) blocked the Suez Canal<\/strong> in Egypt for 6 long days – just enough time to disrupt global shipping for many weeks or even months thereafter.<\/p>\n

Suffice to say that a general, albeit manageable, shortage of chips promptly snowballed and has since significantly disrupted the supply of everything from electric vehicles (EVs) and graphics cards to broadband routers, smartphones, video game consoles and the list goes on (i.e. the companies that rely on such chips often had to halt or slow production of their devices).<\/p>\n

On top of that, any serious problems in the supply chain can also result in higher prices, although this hasn’t impacted every sector, which is perhaps partly because a lot of companies still have a backlog of pre-existing orders that need to be fulfilled (some of those will have been agreed before all of this began).<\/p>\n

Karsten Gewecke, Zyxel (Router Manufacturer), said in April 2021:<\/strong><\/p>\n

“It\u2019s a snowball effect that we\u2019re 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.”<\/p><\/blockquote>\n

A few months have now passed since the situation ballooned into a full-blown crisis, but sadly the problem is far from over. The trouble now is that not only are there significant ongoing delays, but some network providers that were previously able to continue by using existing or surplus stock are running low and starting to truly feel the problem.<\/p>\n

Naturally, our focus is on the broadband and mobile sector, which tends to reflect a variety of different devices from consumer and core network routers to bundled TV set-top-boxes and so forth. Over the past couple of weeks\u2019 we’ve spoken, privately (for obvious reasons most prefer to be off-the-record), to more than a dozen different ISPs, manufacturers and communications providers, all of which seem to be seeing the same problems.<\/p>\n

“We’re being warned of Nokia supply being constrained throughout 2022<\/em>,” said one source to ISPreview.co.uk, while another added that they’d been “told 235* days for the [Juniper] ex4650s. Quite a lot of kit is 8-9 months+<\/em>.” Consumer broadband kit is also impacted, with a different provider noting that they were “being severely restricted by our supplier in [the] Technicolor routers we use as customer CPE<\/em>.”<\/p>\n

The lead time to delivery does seem to vary a fair bit between different products from the same manufacturers, as well as between different manufacturers in general. All of this reflects the fact that the “shortages are affecting some chip suppliers more than others<\/em>,” said a different ISP. In short, many of the lead time delays being seen seem to vary, but stretch up to around 5-9 months.<\/p>\n

As one of our sources eloquently pointed out, “9 months starts to get quite crappy<\/em>.” Indeed, delays that stretch over around 6 months can become a problem because by the time your hardware arrives then it may have already been superseded by the launch of a new generation or model revision of the same device \/ line (technological evolution doesn’t stop, not even for supply issues), which can devalue the original order.<\/p>\n

Suffice to say that the problems are not yet over, although we are starting to see some improvement and most ISPs are now ordering what they need well in advance (i.e. with any luck most broadband consumers won’t notice the impact).<\/p>\n

Back in May 2021 AVM’s UK Sales Manager, Matthew Tyler<\/strong>, told us (here<\/a>) “the global chip crisis [was] keeping things tense, [but] we see this relaxing later in Q4 with increasing additional supply of the new Wi-Fi 6 products<\/em>.” Others have also echoed their expectation of improvement, if not total resolution, by the end of 2021.<\/p>\n

Finally, a spokesperson for DrayTek told ISPreview this week: “We are not immune to the effects of the global chip shortage. It continues to affect our supply of certain DSL<\/a> routers and modems. Luckily, it hasn’t affected our supply of fibre routers or our ability to launch a new G.fast<\/a> router series later this month<\/em>.”<\/p>\n

UPDATE:<\/strong><\/p>\n

Correction, the final paragraph should have been attributed to DrayTek, not Zyxel.<\/p>\n","protected":false},"excerpt":{"rendered":"

Back in the early spring, we reported on how the global shortage of semiconductor chips was causing huge delays in the market for broadband ISP network kit (e.g. routers), which could make it harder for providers to add new customers, replace faulty kit or launch new products. 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