On June 9, the FCC granted a partial waiver of its March ban on certain routers. The situation is bureaucratic and messy. While the March order banned “all consumer-grade routers produced in foreign countries” on national security grounds, the June waiver does not lift that ban.
Instead, the waiver allows already-approved domestic routers (approved by the FCC before March) to have certain parts substituted – substrate material and memory – without triggering a full re-certification process. In effect, the FCC is treating these modified designs as the same product, avoiding the need for them to go through a new approval process all over again.
This waiver was in direct response to the NCTA – the Internet & Television Association, which petitioned the FCC on June 2 explaining why it’s so important that their members be allowed to substitute components in their router designs: “unavoidable supply chain shortages in critical substrate material and memory . . . significantly constrain the industry.” The original ban in March had threatened to sharply limit new router imports and sales until approvals or waivers could be secured since the vast majority of waivers are made abroad.
In fact, the substrate and memory shortages are so severe that it would’ve been difficult for the FCC to find a worse time to ban consumer-grade foreign routers. The shortages are hitting broadband operators like NCTA members hard as increasing demand for capacity, driven by the current boom of artificial intelligence, is affecting their ability to serve their customers. Surging demand for AI GPUs has drawn massive production capacity toward high-end AI chips, tightening supplies of traditional everyday components used in broadband. This includes DRAM (Dynamic Random Access Memory) and non-volatile memory. Substrate materials – the foundational layers used for broadband and AI semiconductors – are also in short supply.
As NCTA explained in its petition: “Driven largely by surging demand from AI, manufacturers are shifting production toward DRAM chips used in data centers, and this shift has tightened supply for the widely used DRAM memory components that support everyday technologies like routers . . . [AI] is driving unprecedented demands for substrate materials, leading to a growing shortage of the necessary materials for semiconductor manufacturing.”
The FCC’s waiver provides some immediate relief for NCTA members and other broadband providers. But the FCC can do more. In a June 3 coalition letter, NCTA and other participants urged the FCC to take broader action: “Ease constraints on alternative sourcing and product redesign by offering expedited validation and approvals for regulated products, along with flexibility for necessary hardware, firmware, or software changes . . . Identify and remove regulatory barriers that slow the expansion of memory manufacturing capacity, both domestically and internationally, to increase overall global supply.”
Substrate material and memory supply were a problem long before the FCC’s March routers ban, and these shortages continue to pose real challenges for broadband as telecommunications infrastructure requirements and AI demand keep growing.
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