Easing of the Supply Chain

One of the biggest broadband issues in 2021 and 2022 was that ISPs suddenly found themselves unable to buy the materials and electronics needed to construct networks. Within six months after the onset of the pandemic, wait times for many fiber and electronics components had stretched to a year or longer. Before the pandemic, ISPs knew they could order materials a few months ahead of construction and have the material on-site when needed.

The Fiber Broadband Association recently announced a dramatic improvement in the supply chain for fiber networks. The FBA cited the following decreases in the waiting times for the delivery of fiber materials by comparing the average wait times for material deliveries in the summer of 2022 to March 2023.

  • The lead time for fiber cable dropped from 52-60 weeks to 4-10 weeks.
  • The delivery time for handholes decreased from 22-26 weeks to 8-14 weeks.
  • The wait times for fiber cabinets and splitters decreased from 10-20 weeks to 4-8 weeks.
  • Delivery times for fiber multiport terminals dropped from 20-35 weeks to 4-8 weeks.
  • Conduit backlogs decreased from 15-20 weeks to 3-7 weeks.
  • The wait time for home electronics and wiring decreased from 12-24 weeks to 4-10 weeks.

This is all good news for the many ISPs building fiber networks. Lead times have almost returned to pre-pandemic levels, and somebody building fiber no longer has to worry about being able to obtain the needed materials.

There are a lot of reasons for the supply chain improvements:

  • New Capacity. New factories have been built to manufacture fiber, conduit, and other components.
  • Re-Sourcing. Before the pandemic, a lot of fiber electronics were produced in the Wuhan province in China. When the pandemic largely shut down the province, manufacturers of electronics found other factories around the world ready to take on the manufacturing. This process took a few years, but China is no longer the only source of some key components.
  • Raw Materials. The pandemic also shut down the mining and shipping of rare metals and other raw materials that are key components of electronics. Those supply chains are now back and operating at pre-pandemic levels. There has also been a worldwide push by geologists to find new sources of ores, and there are new mines being opened around the world.
  • Logistics. During the pandemic, I saw daily stories about how the ports and the trucking industry in the U.S. were backed up and paralyzed. Even when materials were delivered from overseas, it could take months to get them through the ports. At the same time, the pandemic saw a lot of older truckers retire and created a trucker shortage. Logistics are getting back to normal, but I’ve noticed that the radio is still full of ads from trucking companies looking for drivers.
  • Reduced Demand. The largest ISPs in the county collectively trimmed their projected construction for 2023 by millions of passings. That alone frees up a lot of demand for materials that can be used elsewhere.

We may not be out of the woods completely for the supply chain. Future increases in demand from both the big ISPs and the billions that will be spent on grants are going to keep the pressure on manufacturers. But as long as the pandemic-related factors don’t return, this might mean slightly longer delivery times, but nothing like we saw during the pandemic. I recall getting calls from folks who were aghast that they were being given delivery times of over a year for fiber. It seems like those ugly times are behind us.

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