No sector seems spared from the supply difficulties. This is also the case for fiber optic cables, whose wholesale deliveries are expensive and slow.
The difficulties in obtaining fiber optic cables are confirmed. As a result, wholesale prices soar and delivery times lengthen. This does not fail to slow down the deployment of very high-speed infrastructures on a global scale. China, Europe and India are the most affected countries, according to data from the specialized consulting firm CRU.
While the price per kilometer of optical fiber had fallen to $3.70 in March 2021, it currently stands at $6.30, i.e. that seen in July 2019. After the pause of a large number of construction sites during the confinements due to Covid-19, the demand for optical fiber exploded with the resumption of activity, both on the side of submarine cable operators and telecom operators who continue to deploy fiber and 5G, or even large data center projects.
For Michael Finch, analyst at CRU, the situation is such that it calls into question the ability of some countries to achieve their ambitious deployment objectives, while raising fears of adverse effects on the growth of the digital sector as a whole. For information, consumption of fiber optic cables increased by 8.1% in the first half of 2022 (compared to 2021), when 46% is purchased by China. But it is in North America that demand is the strongest, with deliveries up 15%. However, the offer is struggling to follow.
One of the reasons given concerns manufacturing problems, notably caused by the shortage of helium, a crucial gas in the manufacture of optical fiber and whose costs have more than doubled in two years. Ditto for silicon tetrachloride, a chemical compound whose prices have jumped 50%. At Corning, which helped invent the technology in the 1970s and is the world’s largest manufacturer of fiber optics, we have never seen such a tense and inflationary situation.
Manufacturers are therefore asking governments and operators to be patient, indicating that the situation will eventually improve in the medium term. However, the delivery times for certain products can currently reach one year, whereas they did not exceed five months previously.