US telecoms trade groups told the Federal Communications Commission (FCC) supply chain disruptions extend beyond semiconductors, adding complexity to government efforts to craft policies aimed at promoting supply chain resilience.
Comments from a range of industry stakeholders came in response to a FCC call for feedback on the possible ramifications of an ongoing semiconductor shortage on the US telecom industry.
The Competitive Carriers Association stated its members are experiencing long lead times as they try to procure network equipment and smartphones, explaining a global semiconductor shortage is not the only culprit.
It cited shipping delays, shortages of containers and raw materials, and Covid-19 (coronavirus)-related challenges as other contributors to supply chain disruptions.
The Telecommunications Industry Association predicted substrates (wafers) will be in short supply until 2023, highlighting a shortage of legacy chips and saying the industry has been plagued by under-investment in chips made with older manufacturing technology.
Legacy chips are used by the automotive industry as well as network operators, and auto industry executives have asked President Joe Biden to earmark a portion of any government-funded chip production for their industry.
The TIA asked the FCC to advocate against this, arguing it would slow economic growth and exacerbate the US digital divide by diverting resources away from broadband.
It stated the telecoms industry “drives 50 per cent of all demand for semiconductors”, a little more than half of which is from device makers.
The group estimates shortages “will continue for some time and that in 2022 demand will be around 150 per cent of existing fab capacity”.
In the US, smaller operators are expected to be hardest hit by an ongoing shortage and have already told the FCC it could impact their ability to comply with a government mandate to replace equipment made by Huawei and ZTE.
Government cogs are whirring on the US Innovation and Competition Act, which will allocate $52 billion for domestic semiconductor manufacturing, along with a planned Creating Helpful Incentives to Produce Semiconductors (CHIPS) for America bill offering a pot of $10 billion.Subscribe to our daily newsletter Back