blinking yellow light on time machine

Have you tried a full reset?

See pages 28 and 29. Using Airport Utility (page 29), I don’t see the options the manual says are there. I have done a reset and a full reset (page 28) many times and it has always straightened out the Time Capsule.

Time Capsule Manual

Airport Base Station or Time Capsule Reset

Apple just came out with a firmware update for Time Capsules (and other network routers) - as of Dec 20.

If you run the "Airport Utility" app (located in the /Applications/Utilities folder) you can update the firmware to make the yellow blinking light go away.

Good luck...

see Apple - Support - Downloads for more information. Note that there are two different updates (one for older 802.11n and one for newer 802.11ac based models). The device will download the correct version when you open the Airport Utility program when you tell it to update the firmware.

Since the Time Capsule is an Airport Base Station with a hard drive, this usually means there is an issue with your WiFi network setup. Use your Airport Setup Utility to determine what this may be.

You may need to connect directly via ethernet to the Time Capsule and reconfigure it to accept more clients, or do something different. Note without WPA2 encryption, you may have outside users of your wireless network.