It is not possible to use a USB storage device connected to the FRITZ!Box with Time Machine.

Only external hard drives connected directly to the computer via Thunderbolt, FireWire or USB, as well as the integrated hard drive of an Apple Time Capsule and drives of other computers with macOS in the FRITZ!Box home network are suitable for use with Time Machine.

Note:You can use a network cable or Wi-Fi to connect an Apple Time Capsule to the FRITZ!Box and then use it on all of the computers in the home network. Refer directly to Apple for information on Time Machine and Time Capsule, for example consult the manual.