Article Date: October 26, 2021
Global server chip shortage worsens, Intel & AMD in tight supply
It's no secret that the tech industry is facing serious supply chain issues resulting in shortages in everything from graphics cards to integrated circuits (ICs). When it comes to ICs for servers and data centers, the problem is worsening with Cisco, Arista, Juniper, and HP seeing long lead times for their overseas manufactured switches and routers. Intel and AMD data center and server ICs have increased lead times from 52 to 70 weeks.
Chip crunch extended to 2023, expected by top semiconductor & electronics manufacturers
Industry sources polled by DigiTimes indicated that shortages of server components are unlikely to ease or be resolved within the next 17 months.
Intel CEO Pat Gelsinger in April commented that it would take “a couple of years” for the chip sector to rebound from the shortage. He explained the only way to correct the imbalance between supply and demand is to establish additional production capacity. Since modern fabrications take years to build and equip, significantly ramping up production proves difficult.
Flex Ltd., the world's third-largest OEM and EMS provider expects that the global chip shortage will continue into 2023. The firm which counts Ford, HP, and Dyson as clients, has encountered major disruptions due to the crisis. Without critical components or parts, Flex had to temporarily shut down some of its production lines.
Bad news for network operators counting on OEMs like Cisco and HP to deliver
With over a year of pandemic spurring digital transformation and data demand, network operators are under pressure to deliver the goods. Their strategies and long awaited plans to overhaul network IT equipment to meet rising business and consumer demands are now stalled. The inflection point - to wait for OEM supply problems to pass or seek alternative solutions.
What are the options?
Ripping and replacing OEM systems with new ones can be effective strategies to overhaul legacy infrastructure, but it can also be complex and expensive. Consider other strategies to optimize existing infrastructure while keeping upgrades simple and affordable.
OEM compatible optics in a wide range of form factors, speeds, wavelengths, and reach are plug and play solutions that can be integrated easily with existing network infrastructure. These readily available alternatives can quickly alleviate network bottlenecks for bandwidth and speed. Extending the life of an existing network infrastructure will be important to riding the current supply chain shortage.
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