Prices of consumer electronics are set for hefty increases in the coming months as a global scramble for memory chips, driven by the artificial intelligence (AI) boom, pushes up manufacturing costs and demand tightens supply.
AI data centres, which require enormous amounts of computer memory and high-bandwidth memory, have created a demand shock in the market.
Industry analysts say the increases are unlikely to be temporary, with rising memory prices expected to affect almost every category of consumer electronics.
Apple has already implemented hefty price increases.
The company’s 13-inch M5 MacBook Air has seen prices leap to about R26,500 this week from R20,000 late last week.
The MacBook Neo — Apple’s newest budget laptop, launched just three months ago at an attractive R12,000 — has hopped up to R14,000.
The surge in demand and plunge in supply is fuelled by an explosion of AI data centres, with companies investing billions to train and run increasingly sophisticated AI models.
As chipmakers prioritise production of higher-margin memory products for AI applications, supplies for consumer devices tighten, driving prices sharply up.
Reuters said the shortage spans most memory products, from flash chips used in smartphones, USB drives and solid-state drives to dynamic random-access memory (DRAM) and high-bandwidth memory (HBM), which powers AI servers.
Arthur Goldstuck, MD of World Wide Worx, said AI has fundamentally reshaped the global memory market.
“Data centres training and running large AI models consume vast quantities of advanced memory and enterprise-grade storage, creating demand that manufacturers have struggled to match,” he said.
“AI isn’t the only reason prices are rising, but it has become the dominant driver of today’s supply constraints.
Goldstuck said some laptop prices have risen 15% to 20% in the last few months.
But increases are unlikely to be uniform across brands and retailers because existing inventories were purchased at different prices.
“Prices won’t move in lockstep, but consumers should expect higher prices as new stock reaches SA.”
The impact extends beyond laptops. Smartphones and tablets also rely heavily on flash memory, making them vulnerable to rising component costs.
Glenn du Toit, country manager for Acer SA, said they would adopt “flexible pricing and promotional strategies” to support demand and stabilise product availability as costs increase.
He said rising component costs are reshaping consumer behaviour, with some buyers maintaining fixed replacement plans, some shifting to lower-spec devices and others delaying purchases.
Samsung and Lenovo representatives were unavailable for comment.
Memory has become one of the fastest-rising costs in laptop manufacturing, although it remains only one component of the overall bill for materials.
According to Goldstuck, the effect on retail prices is amplified by shipping costs, distributor margins, exchange rates and VAT.
While premium laptops with larger memory configurations are expected to see the steepest increases, entry-level devices are unlikely to escape the trend.
“Entry-level machines are vulnerable because manufacturers have very little margin to absorb higher costs,” Goldstuck said.
“Premium laptops with 16GB or 32GB of RAM and larger SSDs are likely to experience the biggest increases because they contain substantially more of the components that are becoming scarce.”
He warned that if forecasts that memory prices will remain elevated through 2027 prove accurate, the consequences could reach beyond more expensive gadgets.
“Personal computing becomes more expensive just as more powerful hardware is needed for AI-enabled software. That creates a widening affordability gap. People delay upgrades, businesses extend replacement cycles and students enter the market with older or less capable devices.”
“Ironically, the more valuable the computer becomes as an AI tool, the harder it becomes for many people to afford one. This is one of the ways in which AI will widen the digital divide.” — Business Times