Optical Fiber Shortage Threatens Digital Expansion

27. July 2022 | Economy

Rising prices and supply bottlenecks are also caused by shortages of raw materials.

Now fiber optic cable is also in short supply: After semiconductor chips, solar modules and other electronic components, the transmission medium for high-speed Internet is becoming scarce. The worldwide shortage has led to a price increase of up to 70 percent and is lengthening delivery times, reports the Financial Times with reference to the market research company Cru Group.

One reason is strong demand growth: in the first half of the year, total cable consumption increased by an estimated 8.1 percent, compared with the same period last year. In addition to telecom providers, tech companies such as Amazon, Google, Microsoft and Meta are also buying up large quantities of fiber optic cable as they lay huge fiber networks under the sea to build new data centers.

At the same time, Cru blames the shortage on rising prices for some components important to fiber optic technology, such as helium and tetrachlorosilane (silicon tetrachloride). Other essential materials for fiber optic cables, such as germanium or indium, are on the list of critical raw materials for the EU (PDF); in the coming years, the supply situation here could become even more acute as demand increases.

The current shortage situation is likely to pose further challenges to digital infrastructure expansion plans in many places. Europe, India and China are particularly affected by the bottlenecks.

Photo: iStock/peterschreiber.media

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