AI Boom Tightens Storage Chip Supply, Potential Cost Pressures Ahead — How Should the Industry Respond?

Click: time:2025-11-21

As AI applications expand rapidly, global demand for storage chips such as DDR and Flash has increased sharply. Some upstream manufacturers are shifting capacity toward AI-related memory products, resulting in tighter supply and faster quotation cycles for general-purpose storage chips.

This shift is already affecting the PON/FTTH equipment sector, where OLTs, ONUs, optical amplifiers, and various transmission devices rely on storage components during production. Cost fluctuations and lead-time uncertainty may become more common.

Potential impacts on optical networking products

• Rising cost pressure for PON equipment

• More unstable lead times as chip quotations shorten

• Growing attention on China-made chip solutions as alternative options

Common response strategies in the industry

(based on market observations; not tied to specific data sources)

1. Plan key equipment procurement earlier
   Many integrators and distributors are beginning to monitor OLT/ONU replenishment cycles more closely.

2. Evaluate China-made chip solutions
   Considering performance, compatibility, long-term stability, and project requirements.
   Final decisions should rely on product tests and vendor validation.

3. Stay alert to supply chain signals
   Changes in chip capacity allocation, pricing trends, and vendor policies may influence future PON device costs.

The optical communication industry is entering a phase of rapid supply-chain change.
Have you seen early signs in your market or projects? Feel free to share your observations.