The relentless surge in artificial intelligence (AI) development is creating an unexpected and costly side effect for everyday consumers. A severe shortage of memory chips, driven by insatiable demand from AI data centres, is now poised to make smartphones and personal computers significantly more expensive in the coming months.
The Core of the Crisis: AI Books Out Supply Until 2027
The heart of the problem lies in the supply chain for crucial components like Random Access Memory (RAM) and Solid State Drives (SSDs). Prices for these parts have already doubled or even tripled in recent months. Now, industry leaders confirm the situation is critical. Memory manufacturing giants Samsung Electronics and SK Hynix, who together control over 70% of the global market, have stated their planned production capacity is completely booked for this year.
According to research firm IDC, this unprecedented shortage is not a short-term blip. They warn it could persist until at least 2027 because demand from AI infrastructure continues to massively outpace the available supply. This scenario, analysts say, likely signals "the end of an era of cheap, abundant memory and storage" for the foreseeable future.
Consumer Electronics Makers Sound the Alarm
The ripple effects are now directly impacting device manufacturers. A new report highlights that companies including Dell, Lenovo, Raspberry Pi, and Xiaomi are warning customers about impending price increases. The estimates suggest the chip shortage could force retail prices for finished goods to rise by anywhere between 5 and 20 per cent.
During a November earnings call, Dell's Chief Operating Officer Jeff Clarke remarked that the company had never witnessed "costs move at this rate." In a proactive move, Lenovo, the world's largest PC maker, has begun stockpiling memory chips and other key components to shield itself from future supply shocks.
Price Hikes Begin, But Giants May Be Shielded
The warnings are translating into action. Taiwanese tech firm Asus has already announced it will start raising prices on several products. Similarly, Dell is reportedly planning increases ranging from $55 to $765 for its high-end memory upgrades.
However, not all brands will feel the pinch equally. Tech behemoths like Apple and Samsung may demonstrate more resilience against these immediate hikes. Their advantage stems from long-term supply agreements negotiated with chipmakers, which can offer some protection against volatile spot market prices.
For consumers, the immediate future looks more expensive. One visible consequence could be a trend of new smartphones launching with lower base RAM configurations as companies try to manage costs. Citigroup analyst Peter Lee summarised the outlook starkly, noting that AI data centre demand has exceeded all expectations and that "supply will remain tight until 2027, with no additional capacity expected." The age of AI is here, and one of its first major impacts on the public is a heavier bill for the devices they use every day.
