David F. Peach

Abstract: The ability to rapidly mobilize the telecommunications industry is of concern in National Security and Emergency Preparedness planning scenarios. This report assesses the extent to which the U.S. telecommunications industry is dependent on foreign sources for key components. It concludes that there is a severe dependence on foreign sources for certain types of semiconductor devices as well as many factory materials and other raw materials used to manufacture these devices. This dependence is of particular concern because of the length of time it takes to build a semiconductor factory to replace a lost supply. The long-term impacts of a disruption in supply for semiconductor devices are somewhat mitigated by the fact that most semiconductor factory equipment can be obtained from domestic sources. There is little foreign source dependence for fiber optic and related optoelectronic devices. The report also discusses some of the factors that affect the relative competitiveness of U.S. manufacturers and makes recommendations for improving U.S. firms' competitive position, thereby reducing foreign source dependence.

Keywords: telecommunications; fiber optics; foreign source dependence; emergency preparedness; factory equipment; global competition; national security; semiconductor devices

Disclaimer: Certain commercial equipment, components, and software may be identified in this report to specify adequately the technical aspects of the reported results. In no case does such identification imply recommendation or endorsement by the National Telecommunications and Information Administration, nor does it imply that the equipment or software identified is necessarily the best available for the particular application or uses.

For questions or information on this or any other NTIA scientific publication, contact the ITS Publications Office at ITSinfo@ntia.gov or 303-497-3572.

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