Careful: Shortage fears can lead to over-ordering and create a real shortage. Unless people panic, the problem is unlikely to be more than a few weeks delay in an order. Tan's comment in the financial call ("We're also working on resolving a few potential supply constraints in this particular segment." Details below) is likely circulating in the industry, and this article might. The instinctive action is to panic and double order, which is a pattern we see in chips on a regular basis.

Broadcom is the largest supplier of chips for both DSL & cable. The comment surprised me because the primary foundry, TSMC, is missing sales targets and generally has capacity. I haven't seen any huge increase in demand for broadband chips. Broadband subscriber growth in Europe and the United States is modest. Liberty Global is just getting started on increasing their cable coverage. Deutsche Telekom is two years behind schedule on it's big vector expansion. 

China added an unbelievable 50M fiber connections in 2015 and Hock says that trend is continuing.

 China Mobile in March added over two million new fiber subs as they overbuild Telecom and Unicom across the country.

Meanwhile, China is adding 20M 4G customers monthly, including China Telecom's effort to move everyone from 3G to 4G. China Mobile reached 400M 4G subs in May. 

Here are Hock's comments from the call:

We also saw strong demand for our broadband products from set-top box refreshes driven by the start of adoption of 4K video. Service providers continue to invest in broadband access infrastructure, including ongoing fiber-to-the-home build-outs in China, as well as DSL and cable modem build-out in Europe. As we look into the third quarter for wired segment, we expect the strong demand to sustain from the prior quarter, and project wired segment revenues to be up in the low single-digits sequentially. We're also working on resolving a few potential supply constraints in this particular segment.

Yes, there is supply constraint in certain areas, and that does extend out lead times somewhat, which we are working very hard to improve. Simply, because we believe the demand is real out there. And yes, it does extend to Q4, and we are starting to have visibility on bookings and backlog into Q4, as we sit here right now.

Broadcom is shipping G.fast chips to Alcatel and Huawei but deployments are just beginning.

 

 

Latest issue

Jan 18

300,000 Indian Villages Fibered; 325,000 More To Come http://bit.ly/600KIndia
Verizon, NTT, AT&T: ?$200-$400 5G Costs Much Lower Than Expected http://bit.ly/Hans200400
Important: 5G Handles 10x More Data Than 4G http://bit.ly/5G10X4G
India Passes U.S. in Smartphones http://bit.ly/India40Msmartphones
AT&T Probably Will Not Have a 5G Mobile Phone in 2018 http://bit.ly/T5G2019
Pai, Speaking of Immigration, Put His Career on the Line http://bit.ly/Paicourage
35b: Ready or Not? Germans Say Not, Some Say Yes http://bit.ly/35bready
Qualcomm's Not To Be Believed Comeback in G.fast http://bit.ly/Ikanoslives

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Manoj Sinha announced that 300,000 Indian villages have been connected by fiber and BharatNet is on target for 325,000 more early in 2019. This is by far the largest rural broadband project in history. Bids are out for 500,000 Wi-Fi hotspots and 130.000 post offices will connect. The telcos are offered low prices to bring in LTE and fiber home. Programs are underway for > 100,000 local business to offer connectivity.  

Ajit Pai risked his career by challenging Trump's immigration policy. "My love and reverence for this country comes from living in the house of Raj and Radha Pai. My parents know a little something about the American Dream. They came to this country 46 years ago with literally no assets other than $10, a transistor radio, and a desire to achieve that dream." I never imagined America would plan to deport four million people. 
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