As Intel battles to get on top of CPU shortages that have plagued its business in recent months, the world’s largest computer makers are hunkering down for six months of tight supply.
A surge in Windows 10 PC refreshes, demand from cloud infrastructure builders and Apple, coupled with struggles to produce 10nm silicon has caught Intel short.
Intel’s CFO and interim CEO Robert Swan last month wrote a letter to reassure customers that Chipzilla would be able to be able to meet demand, prioritizing production of Xeon and Core processors to serve “high-performance segments” of the market. He admitted, however, that “supply is undoubtedly tight, particularly at the entry-level of the PC market”.
This holds true with what ACTSmart and other integrators are experiencing. Entry-level and lower priced computers are experiencing a 6 to 8 week lead time while many models are simply not available. Mid-level to high end systems (both Servers and Workstations) are shipping in 1 -2 weeks which is the normal lead time for a custom or “purpose built” system.
I’m also finding that upgrading to an i7 or Xeon processor, avoiding the mid-level i5 CPU is offering shorter lead times and quicker turn-around as well. I expect this turn-around time to change as the i7 inventory depletes over the next few months.
Why is this important? It’s important to realize that this is a GLOBAL issue. We are in the final 11 months before Windows 7 and Server 2008 enter their permanent “End of Life” cycle (January 14th, 2020). The demand for replacement Servers and Workstations is at its highest level ever (even higher than the Windows XP demise a few years ago).
Unfortunately, this shortage will impact every business needing a PC or Server refresh this year and the lack of chips could potentially cause regulatory and compliance challenges if the chip and motherboard manufacturers can’t meet the demand for new systems in a timely manner.
How will this affect you? We’re seeing computer prices climbing higher than last year on top of having to upgrade to higher priced models using the higher/faster CPU’s.
We should expect this shortage to substantially increase the cost of meeting the 2020 deadline and in some cases put a real strain on a business owners bank account. If you had hoped to wait until Q3 or Q4 to start your refresh cycle (like many business owners around the word) there could be some challenges with meeting the 2020 deadline.
I don’t expect prices to go down when CPU supply increases – that’s just the way things work. Now is the time to give serious thought to getting your business system upgraded – perhaps sooner than later- there’s no reason to delay and every reason to get ahead of what’s in store for us all in Q3/Q4 of 2019.
For additional information here’s an article from CRN – a technology news source:
https://www.crn.com/news/components-peripherals/partners-intel-cpu-shortage-delaying-shipments-raising-prices
