Water in a Drought: Ongoing Supply Chain Issues and the Need to Adapt


Water in a Drought: Ongoing Supply Chain Issues and the Need to Adapt

More than 2-years into a world-wide pandemic, ongoing supply chain issues continue to pose a challenge for the service provider industry and other bandwidth intensive networks looking to scale to meet customer demands. Chip shortages which have impacted nearly every technology sector have hit especially hard in the networking industry, leading to 12–16-month lead times on new equipment from companies like Juniper and Cisco. Tier 1 carriers and other large customers who typically refresh their network every 3-5 years have been forced to make do with existing topologies while they await delivery of existing orders. Some who rarely buy used equipment have been forced into the secondary market for expanded 100G capacity, which has affected the secondary market supply and put enormous upward pricing pressure on stock. Coupled with a rapidly diminishing supply fueled by delayed upgrades, these confluences of factors have created real problems for growing service providers in need of increased port speed and density.

While companies like Juniper had hoped supply-chain issues would improve towards year-end, Intel, the chip-maker for many switch and routing platforms announced that they expect the chip shortage to last into 2024! This presents a unique challenge for network operators who not only face long wait times on orders of new equipment, but also are increasingly unable to find highly desirable used equipment on the secondary market. Take for example juniper’s 4x100G routing card for its MX platform, the MPC7E-MRATE which we would normally see funneling into the used market as customer migrate to higher throughput 400G interfaces like the MPC10E-15C-MRATE. Over the last 6-8 months, prices for the MPC7E-MRATE have doubled on the used market and that is if you can even find them. The pool of used equipment, much like a watering hole in a desert eventually dries up due to the impact of demand and extrinsic conditions.

In adverse market conditions it often makes sense to seek out underutilized solutions to meet your network needs. One such solution is taking advantage of older equipment that others may overlook that can temporarily meet your needs while weathering the drought. Based on the above example, we have recently taken to proposing either  the MPC4E-3D-2CGE-8XGE or a combination of Juniper MX-MPC3E-3D with 2x MIC3-3D-1X100GE-CFP. While both solutions offer only half the density of the MPC7E, it is a cost-effective solution for adding 100G capacity in the short-term while waiting for market conditions to return to what we once thought of as “normal.” It is these types of creative solutions that are required in order to survive challenging times and everyone from hardware resellers to our data center clients are having to adjust and find ways to adapt.

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May 12, 2022