Throughout manufacturers, smartphones and laptops have gotten costlier with AI growth being blamed for the rise in enter prices, particularly of chips. Even cash-rich tech firms, which usually hold costs regular for his or her units, are now not doing so. Previously few days alone, Apple, Samsung, and Nothing have all launched new units at marginally increased costs in comparison with earlier variations.
“Distributors are rising costs primarily as a result of reminiscence prices have surged dramatically, in some instances rising 200–300 per cent in current months. Most distributors function on comparatively tight {hardware} margins, notably within the mid-range and entry segments. In consequence, they’re pressured to move a part of these increased part prices on to shoppers,” Francisco Jeronimo, Vice President of Consumer Units at Worldwide Information Company (IDC), advised indianexpress.com.
Why AI wants extra chips
With AI firms shopping for reminiscence chips for his or her information centres or information farms, a key focus on the AI summit held in India final month, the costs of those elements have shot up, forcing firms like Apple and Dell to boost costs or minimize margins. These chips are additionally utilized in laptops and smartphones.
All computing units require RAM, or Random Entry Reminiscence. Consider RAM as a pc’s short-term reminiscence that permits a number of functions to run concurrently. Primarily, RAM is a foundational part of contemporary computing units, and it goes into nearly each tech product you purchase, from smartphones, tablets, laptops to a automobile’s infotainment system and online game consoles.
For years, RAM manufacturing had remained regular, maintaining with shopper demand. In the course of the pandemic, nevertheless, there was a short international RAM scarcity, though provide finally returned to regular. This time, amid the AI increase, firms like OpenAI, Meta, and Google are utilizing massive quantities of reminiscence to energy servers of their huge information centres.
RAM is a essential part of just about each type of laptop. (Picture credit score: Google)
Actually, AI information centres require considerably extra high-performance reminiscence than a typical shopper digital machine. Chipmakers comparable to Nvidia place a number of blocks of high-bandwidth reminiscence (HBM) across the graphics processing unit (GPU), the a part of the chip that performs the principle computations. This quick, specialised reminiscence is required for heavy AI workloads.
For context, Nvidia’s Rubin GPU makes use of as much as 288GB of next-generation HBM4 reminiscence, organized in eight blocks across the processor, and is deployed within the NVL72 server rack, which mixes 72 GPUs in a single system. As compared, smartphones usually include solely 8GB, 12GB or most 16GB of lower-power DDR reminiscence.
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To grasp the present RAM value rise, it is very important know that Samsung, SK Hynix, and Micron are the three largest RAM producers on the earth, collectively accounting for about 93 per cent of the market. With only some international gamers within the RAM enterprise, reminiscence provide has all of a sudden turn into constrained, as AI firms are getting first entry to reminiscence for his or her information centres and are prepared to signal long-term offers.
One would possibly ponder whether Samsung, the world’s largest smartphone maker, has limitless entry to RAM for its telephones. It doesn’t work like that. Samsung Semiconductor, which manufactures reminiscence and different chips and provides the worldwide market, might select to promote to firms prepared to pay high greenback for his or her {hardware}, prioritising information centre prospects to maximise earnings. Samsung’s cell division should still need to compete to safe RAM for its Galaxy telephones, and there’s no assure, given the present RAM scarcity, that the phone-making division can safe a long-term provide deal. That’s how enterprise works.
With costs of telephones regularly rising, prospects might want to resolve whether or not to pay extra or settle for a much less highly effective machine. (Picture credit score: Anuj Bhatia/Indian Categorical)
‘Cellphone makers are already feeling the stress’
Jeronimo says all cellphone makers are resistant to the reminiscence drought, with smaller gamers being the worst hit, grappling with skinny margins and rising part prices.
“All distributors will really feel the affect, however not equally. Distributors comparable to Apple and Samsung are usually in a stronger place as a result of they function closely within the premium phase, the place margins are increased. Additionally they have better monetary sources and supply-chain leverage, permitting them to soak up a part of the fee will increase or safe higher part provide. Smaller manufacturers or these competing primarily in lower cost segments face a a lot better problem,” he mentioned.
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Samsung has turn into the primary main cellphone model to extend the worth of its Galaxy S26 sequence, which debuted late final month and can go on sale worldwide this week. The mainline Galaxy S26 begins at Rs 87,999, the S26 Plus at Rs 1,19,999, and the highest-end Galaxy S26 Extremely at Rs 1,39,999. As compared, the Galaxy S25, launched in India final yr, began at Rs 80,999, with the S25 Plus at Rs 99,999 and the S25 Extremely at Rs 1,29,999. That’s an enormous value bounce, with the S26 Plus’ value rising 20 per cent over the S25 Plus. Though Samsung has made 256GB the bottom storage this time, shoppers should still really feel the pinch with the upper asking value.
In the event you suppose solely Samsung’s high-margin Galaxy S26 noticed a value hike, you might be mistaken. The corporate has additionally adjusted costs of a number of Galaxy smartphones throughout the M and F sequence in India, which fall within the mid-range phase. That’s a sign that value hikes are widespread and better RAM costs at the moment are hitting an organization like Samsung, too.
British tech firm Nothing has adopted an identical path to Samsung by rising the costs of its smartphones. The newly launched Cellphone 4a sequence was unveiled final week in London, with the baseline Cellphone 4a beginning at Rs 31,999 and the 4a Professional at Rs 39,999. Each new telephones are costlier than their predecessors: the Cellphone 3a and 3a Professional, launched a yr in the past, have been priced at Rs 22,999 and Rs 27,999, respectively.
Samsung’s Galaxy S26 lineup of smartphones come at the next costs. (Picture credit score: Anuj Bhatia/The Indian Categorical)
Whereas Nothing did introduce adjustments to its new smartphones – the 4a Professional incorporates a main design revamp and improved cameras, shoppers’ month-to-month paychecks have clearly not stored tempo with rising smartphone costs. CEO Carl Pei had indicated in January that smartphone costs might rise this yr, and that manufacturers within the low-end and mid-range segments might battle as a result of surge in reminiscence prices.
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Lenovo-owned Motorola has additionally elevated smartphone costs, with the brand new Edge 70, a mid-range smartphone, beginning at Rs 26,999. Its predecessor, the Edge 60, was launched a yr in the past at Rs 22,999. In January, a Motorola India government revealed to indianexpress.com that the corporate had been delaying value hikes on its smartphones, whilst a lot of its opponents had already handed on the additional prices to shoppers.
Apple, which is thought for absorbing prices and has stored iPhone costs unchanged in recent times, is now charging extra for the newly launched iPhone 17e, a premium mid-range smartphone in India. The iPhone 17e retails for Rs 64,900 in India, Rs 5,000 greater than the iPhone 16e’s launch value a yr in the past, though Apple has additionally elevated the storage from 128GB to 256GB.
Why mid-range units are worst-hit
As defined by Jeronimo, mid-range smartphones, which usually vary between Rs 20,000 and Rs 50,000 in India, are clearly turning into a casualty of the reminiscence scarcity, a big phase that the majority cellphone firms can’t afford to disregard. Nevertheless, Jeronimo added that the low-end phase has been hit the toughest. Reasonably priced smartphones are extensively seen as a option to slim the digital divide in growing markets like India, the place thousands and thousands of individuals nonetheless use characteristic telephones. However the ongoing RAM disaster might pressure firms to both cease launching finances telephones altogether or enhance their costs considerably. At that time, nevertheless, it will be troublesome to name a finances cellphone an inexpensive smartphone.
“The affect shall be most extreme within the low-end phase, notably units priced beneath $200, which depend on extraordinarily tight margins. With reminiscence costs rising sharply, it turns into economically unviable for distributors to take care of these value factors,” Jeronimo agrees, including that many units that beforehand offered for round $100 might transfer nearer to $150–$200.
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It doesn’t matter whether or not the cellphone is made in India or imported from China, the scarcity of RAM provide will affect all the ecosystem. Nevertheless, it’s nonetheless unclear how firms plan to handle the difficulty.
“Most producers secured sufficient reminiscence provide earlier within the yr to help manufacturing and channel stock by way of the primary half of the yr. In consequence, distributors and retailers are presently stocking up on units whereas provide remains to be out there, which helps maintain gross sales within the close to time period,” Jeronimo mentioned, including that the state of affairs might turn into worse from the second half of the yr onward, when inventories decline and distributors start producing units with rather more costly elements.
Nothing’s Cellphone 4a Professional, though come at the next value level in comparison with its predcessor, obtained substantial upgrades. (Picture credit score: Anuj Bhatia/Indian Categorical)
All that is taking place at a time when cellphone firms are advertising their smartphones as “AI telephones” and going to nice lengths to advertise units constructed round AI brokers, the place the cellphone understands intent, coordinates throughout apps, and takes motion without having to open particular person apps to finish the required steps. Nevertheless, supporting the latest and up to date AI options, particularly those who run on-device requires telephones to have extra RAM onboard. In consequence, the concept that AI’s future lies on the machine quite than within the cloud begins to face challenges.
Up till final yr, tech firms promised a shift AI processing from cloud information facilities to non-public units like telephones and laptops primarily for pace, privateness, and value financial savings, whereas additionally permitting AI to work with out an web connection. Nevertheless, this shift requires extra highly effective {hardware} to help specialised AI fashions.
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With a reminiscence disaster looming, cellphone makers and chip firms want to return to the drafting board and discover new methods to make on-device AI work on units with much less RAM. It could not be stunning if cellphone makers as soon as once more begin introducing lower-tier 8GB RAM fashions in smartphones. Nevertheless, transport a cellphone with 8GB RAM in 2026 is probably not a good suggestion.
Whereas an 8GB RAM cellphone could also be enough for every day use, the on-device AI expertise can be severely impacted. Cloud-based AI does exist, however consultants repeatedly level to privateness and safety as key benefits of on-device AI.
However past the on-device AI push, telephones with much less RAM should not future-proof, particularly as extra shoppers maintain on to their telephones for longer. That is why RAM is without doubt one of the most essential elements inside a smartphone.
The Pixel 10a nonetheless ships with 8GB RAM. (Picture credit score: Anuj Bhatia/Indian Categorical)
No surprise cellphone makers are dealing with a twin problem: whether or not to ship a cellphone with much less RAM when units are closely reliant on AI, or to chop down on inner storage or use an older-generation processor. These powerful choices might affect the smartphone expertise, whilst customers pay extra out of their pockets for the latest units.
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“Strain on costs will proceed for the subsequent couple of years, at the very least, not just some months,” he mentioned. It doesn’t appear like the RAM scarcity goes to subside anytime quickly, as analysts predict that it might “persist properly into 2027.”
Jeronimo says increasing reminiscence manufacturing capability takes lots of time, usually two to 3 years for brand spanking new fabrication capability to come back on-line. On the similar time, demand for reminiscence from AI information facilities and hyperscale cloud suppliers is rising quickly and is commonly prioritised by suppliers, as these prospects buy massive volumes beneath long-term agreements. He provides that whilst provide finally improves, reminiscence costs are unlikely to return to the degrees seen final yr.
IDC forecasts the worldwide smartphone market is predicted to say no 13 per cent in 2026 – the most important decline ever, whereas the PC market can also be projected to contract 11 per cent as increased costs scale back affordability.
If smartphone gross sales decelerate worldwide, the large message that has been closely promoted in regards to the dazzling capabilities of AI might fizzle out. Smartphones and laptops are nonetheless the first gateways for experiencing AI.
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‘RAM scarcity might kill low-cost laptops but additionally give a possibility to rethink the finances phase’
Skyrocketing reminiscence prices imply laptop computer costs might also go up and pressure firms to take much less dangers within the brief time period. The affect of the worsening reminiscence market is already seen on newly launched laptops.
Laptops are already getting costlier, as analysts predicted. The newly launched Apple MacBook Air and MacBook Professional with M5 sequence chips value greater than their predecessors. Actually, it was stunning to see the worth of the M5 MacBook Air, maybe Apple’s hottest Mac when it comes to volumes, begin at Rs 1,19,900, up from Rs 99,900 for final yr’s M4 MacBook Air, a bounce of Rs 20,000, though Apple additionally elevated the minimal storage from 256GB to 512GB. The MacBook Professional with M5 chips additionally noticed steep value will increase.
Dell, HP, Asus, and different laptop computer distributors have additionally elevated the costs of their laptops. Lenovo, the most important PC maker by market share, mentioned that it’ll elevate the common promoting value of its PCs in 2026.
As evident within the case of smartphones, laptop computer makers are additionally following within the footsteps of cellphone makers by launching extra high-end notebooks as an alternative of specializing in decreasing cheaper PCs or quickly halting manufacturing of the latter.
Nevertheless, Apple noticed a market alternative amid the RAM scarcity. Take the case of the brand new MacBook Neo, Apple’s most inexpensive Mac pocket book, priced at Rs 70,000. Though it prices lower than the mainline MacBook Air, the Neo runs on the A18 Professional chip and offloads heavy processing to the cloud, with compromises comparable to a flimsy keyboard, restricted storage, and solely 8GB of RAM.
A big firm like Apple isn’t resistant to value pressures; it did elevate the costs of the brand new iPhone 17e, MacBook Air, and MacBook Professionals. However insiders imagine that the concept of a low-cost Mac might succeed within the present panorama of shortages: reminiscence costs are excessive, inflation is rising, and Home windows notebooks within the low-end phase are sluggish and underperform at their duties. It stays to be seen how shoppers react to Apple’s MacBook Neo, which works on sale from March 11.
Apple has elevated costs of its MacBook Air and MacBook Professional sequence with M5 chips. (Picture credit score: Anuj Bhatia/Indian Categorical)
So what ought to shoppers do?
With reminiscence scarcity to final for just a few extra months, it’s suggested to purchase laptops with increased RAM and pay upfront extra, since most trendy laptops have soldered RAM that may’t be upgraded in a while. For gaming laptops with upgradeable RAM, it’s less expensive in the long run to fill all DIMM slots. In the event you discover a whole lot on a laptop computer, purchase it now as an alternative of ready, as costs are rising and types might reap the benefits of the state of affairs by elevating the costs of older laptops as properly.