A Silicon Chip Shortage May Delay Headphones and Game Consoles, but Don’t Panic

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NYTimes

March 8, 2021

In 2020, the country was challenged by product shortages affecting everything from toilet paper to pasta. Now 2021 is presenting a new obstacle: a low supply of the silicon chips used in computers, smartphones, gaming consoles, and other electronics. After reading some of the coverage of these shortages, you might be concerned that, in a few months, you won’t be able to buy certain devices at all. That’s not quite the case, but the situation may require a little flexibility and patience. We spoke with industry analysts and Wirecutter staffers to find out what you can expect in the months ahead and how to shop for specific electronics.

What’s causing the chip shortages?

The current chip shortage is the result of a perfect storm of factors, including pandemic-related work stoppages, increased demand, and broken transportation logistics. This clusterfrack of issues impacts different tech segments in different ways but often produces delays in getting gear into your hands.

Last year, many industries experienced manufacturing declines or complete halts in production as a result of the pandemic. The handful of plants that make silicon semiconductor chips were no exception. However, as safety protocols for workers were put into place and outbreaks were contained, most plants got back up and running to their original output levels within a few months. That still left a backlog of orders that needed to be filled, though. Despite increasing production to work around the clock by instituting 12-hour shifts (according to the sources we interviewed), the silicon-chip plants could never fully catch up because the orders continued to increase.

Even while manufacturing declined, demand boomed. Silicon chips are in nearly every computer, smart-home product, wireless gadget, and gaming device. As the pandemic shifted the places people work and seek entertainment, more people than ever began buying up new gear to outfit their new normal, according to Stephen Baker, who tracks consumer electronics for the market research firm NPD Group. This surge in sales—consumer tech was up 17% last year, Baker says—left many companies scrambling to meet the new demand. As a result, brands placed significantly larger orders for semiconductors than they would have bought in previous years. With plants already working at maximum possible output, the silicon-manufacturing industry had no way to instantly ramp up to meet these escalating orders.

Adding to the situation is the increased strain on shipping. Anyone who has logged in to check the status of a package has seen the notices from DHL, FedEx, UPS, and the US Postal Service citing increased safety regulations and worker absences as causing significant transportation delays. The commercial shipping business is facing a similar problem: Ports in Los Angeles and Long Beach have container ships clogging the docks, all waiting to be unloaded. So even if a manufacturer manages to obtain the silicon chips it requires and makes the gear you want to buy, getting that gear to your house is taking longer and/or costing the company more.

What kinds of products are affected?

Despite all the hullabaloo, Baker says you should be able to buy just about anything you need—with a few notable exceptions, such as cars and gaming consoles (more on that below)—but you may have fewer choices in a given category. It’s tricky to predict exactly which brands or models might be difficult to find and how quickly they’ll be back in stock. Baker says manufacturers are responding differently to the situation depending on their relationships with the chip makers and their previous product stockpiles. Some are holding off on launching new products. Others are allocating all the chips they can get to their flagship models and most popular or profitable models and holding off on making less-popular or older models. Many companies are planning to hold off on sales, deals, and price drops in an effort to slow demand and reduce the risk of disappointing buyers.

Understandably, in an effort to avoid panic buying (remember what happened with paper towels?), most companies are playing their cards close to the vest at the moment. Wirecutter has been keeping a watchful eye on things, and here’s what we’re seeing in the electronics categories we cover.

Computers, smartphones, and computer accessories

Senior staff writer Andrew Cunningham and the rest of Wirecutter’s PC team started noticing supply problems last spring, when a sudden spike in demand for everything from laptops to monitors to webcams suddenly meant that our picks were disappearing or constantly going in and out of stock. Now that companies have had time to adjust, most things are a little easier to buy than they were at the start of the pandemic. Intel said in December that it had transformed some unused office space—freed up because those employees were now working from home—into manufacturing space that it could use to make more chips to meet demand.

The main issues right now are that some individual computers might be out of stock or hard to buy at any given moment and that good budget products can be harder to find—and more expensive—than they used to be. That’s because companies like AMD are focusing their limited manufacturing capacity on higher-end chips that make more money, so budget chips are in shorter supply.

On Apple’s side of the fence, the company is doing a pretty good job of keeping its basic iPhone, iPad, and MacBook models in stock. But if you try to order a Mac with upgraded memory or storage, that customization will usually add at least a couple of weeks to your ship time.

Game consoles and PC gaming equipment

Although it’s not hard to find a good desktop or laptop computer for everyday work, finding gaming PC equipment and game consoles has become more difficult and more expensive in the past few months. All gaming PCs rely on either Nvidia or AMD to make graphics processors, and both of those companies have recently refreshed their lineups with popular new models that are impossible to find. Likewise, both Sony and Microsoft are using AMD chips in the new PlayStation 5 and Xbox Series X and S consoles, respectively, putting extra strain on the supply chain and making these already-hard-to-get new consoles even more challenging to find.

Andrew Cunningham expects these shortages to last until at least this summer and possibly beyond. AMD has said that it is working on producing more chips so it can meet demand in the second half of 2021, while Nvidia has said that its chip supplies will be “lean” throughout the spring. Even older graphics cards have gotten much more expensive and harder to find; Nvidia recently resuscitated some years-old GPU models to try to meet that demand. And to make matters worse, new tariffs on some PC parts imported from China are adding somewhere between $50 and $100 to the retail price of many GPUs.

Smart-home devices

Senior staff writer Rachel Cericola covers smart-home devices and says that although she has seen popular brands sell out here and there, most things usually come back into stock in limited supply. Two standout examples of this trend are the new Wyze Cam v3 security camera and the Abode Smart Security Kit.

The Wyze Cam v3, which started preorders in October, was still listed on the Wyze website at “notify me when available” status as of mid-February. Since then, Wyze has been offering the Wyze Cam v3 in limited quantities as an exclusive for Cam Plus subscribers until the inventory stabilizes. You can see the original announcement about the shortage on the company’s blog, as well as in this post from The Ambient.

In mid-February, the Abode Smart Security Kit (our current runner-up for the best smart security system) was listed as sold out on Amazon, with limited stock available on Abode.com. A message on the company’s website about the shortage states that it hopes to catch up with demand by Q3 2021.

TVs, speakers, and audio equipment

According to NPD Group’s Stephen Baker, it may be harder to find older and less popular models of televisions later this year, as TV manufacturers funnel the chips they manage to get into the latest flagship models and best-selling options. Our TV expert, senior staff writer Chris Heinonen, says that he hasn’t seen any early-2021 stock problems or shipping delays surrounding our picks, but that he has noticed some high-end audio gear affected by the devastating fire at the AKM semiconductor factory.

Senior staff writer Brent Butterworth, our home-audio expert, echoes this sentiment, adding that so far the more expensive high-end receivers, rather than the more affordable AV receivers that Wirecutter covers, appear to be the hardest hit by the fire. He also hasn’t seen the shortage affect portable Bluetooth speakers thus far. But because the AV electronics industry often works on tight margins to stay profitable while keeping prices low, many companies don’t stockpile more than a few weeks of parts, so any disruption can nearly instantly cause gaps in production.

Headphones

Senior staff writer Lauren Dragan says that most of the impact in the headphones arena involves new and upcoming gear. In 2020 many new headphones that were promised on a given date weren’t available to buy until weeks (or months) later than expected. At the CES 2021 virtual trade show, many product release dates were more vague than usual, often with a few months of wiggle room built in. So instead of saying a new pair of earbuds would be available in the second week of May, for example, companies were making statements like “available mid-spring to early fall.”

On the other hand, Lauren hasn’t yet heard of significant availability issues surrounding our existing headphone and earbud picks. She reached out to six headphone companies that make our picks—1More, Aukey, Bose, Jabra, Puro, and Skullcandy—and all of them said they had sufficient stock available to meet the anticipated demand for current headphones and earbuds. But several noted that they may need to push release dates of new models back by a few weeks to be sure they have sufficient stock for a launch.

What to do if an item you want is out of stock

Be patient and flexible. Although there may be brand-specific shortages (as is the case with gaming systems and cars), across the majority of the consumer technology market, you almost always have other excellent options. Not every single television or laptop will be out of stock at the same time, so unless you have your heart set on a specific device, you won’t have to go without.

Wirecutter guides are designed to be helpful, even if some products are experiencing delays. If one of our top picks is sold out at the retailer we point to, we sniff around to see if it’s available anywhere else. If it’s sold out everywhere and you can’t wait, scroll down the guide a bit: We test a lot of pieces of gear that nearly become picks but fall just short of our top selections in one way or another. So if you need to buy something immediately, look for worthy alternatives in the “Runner-up,” “Also great,” and “Other X we like” sections of our guides. Depending on your situation, sometimes these choices might even be a better fit for your personal needs.

When you’re shopping for a game console or other hard-to-find product, keep an eye on retail trackers like NowInStock.net, a tactic that isn’t perfect but can help to automate the process of constantly refreshing websites to see if things are available. You might also try calling brick-and-mortar retail stores in your area to see if they can tell you when they normally get new shipments of consoles (it’s a long shot, but sometimes it works). And there’s always the Nintendo Switch, which is generally pretty easy to find right now after being in short supply throughout a big chunk of 2020.

If you’re shopping for a gaming PC, it might be easier to buy a prebuilt system than to build your own. Much of what Nvidia and AMD can manufacture is going to PC makers rather than retail sites like Newegg. Many of our budget gaming laptop picks are still available as of this writing, and gaming desktops like the Dell Alienware Aurora Ryzen Edition R10 and Lenovo Legion Tower 5i are currently available with Nvidia’s popular GeForce RTX 3000–series GPUs.

Among PCs for work, you have some alternatives, especially if you’re trying to save money. Buying a used laptop or desktop is a good way to spend less while still getting a useful system with a few years of life left in it. And if you have an older PC sitting in a closet, you might be able to breathe new life into it with a little time and a couple of upgrades.

Despite some delays, manufacturers are doing their best to keep refreshing stock whenever they can, so most gaps in availability will be a matter of weeks, not months. Of course, we’ll be keeping a close eye on all of our picks. If it looks like one is going to be unavailable for a long period of time, we’ll be sure to update you in each guide accordingly. And, as with many annoying things that happened in 2020, this hassle won’t last forever. Our sources expect that companies will return to normal production timelines in early to mid-2022.