Jun 29, 2021

Chip Shortage Will Affect the Availability and Price of IT Hardware for the Next 12 to 18 Months

A shortage of processors and other components could affect the availability and price of IT hardware for the next 12 to 18 months, according to major tech companies including Intel, Dell, IBM, Extreme, Cisco and Juniper.

Per some contacts at Dell, lead times on servers and PCs are reaching well into November. Peripherals such as monitors and docking stations are also in short supply with lead times extending into the fourth quarter. As a result, prices for these items are also increasing. According to Gartner, “Foundries are increasing wafer prices and, in turn, chip companies are increasing device prices.”

The consensus among leaders at Cisco, Intel, and Extreme Networks is that the immediate shortage will continue for at least the next 12-18 months. Building back semiconductor capacity is no easy task experts say. “Increasing semiconductor capacity utilization takes time because semiconductors are incredibly complex to produce. Making a chip is one of the most, if not the most, capital–and R&D–intensive manufacturing process on earth,” wrote Falan Yinug, Director, Industry Statistics and Economic Policy at the Semiconductor Industry Association.

The shortage could create challenges for many businesses as they look to upgrade equipment, hire employees, or expand their operations. Business leaders need to start planning out the next 12-18 months in these areas to mitigate the risks of extended lead times.

This situation may also present an opportunity for other technologies, such as Desk as A Service (DaaS), or other cloud infrastructure technologies to be considered. DaaS would provide a path for users to get the performance of a new desktop without purchasing new hardware.

If you have any questions about how this may affect you and would like to discuss your options, please reach out to Abacus Technologies at (205) 443-5900 or visit their website at https://www.abacustechnologies.com/.