RAM is a vital part in virtually all digital gadgets, akin to smartphones, laptops, gaming consoles, and even automobiles now. However of late, the costs of RAM sticks have been rising. In reality, reportedly, some smartphone producers are already anticipating future value hikes for his or her smartphones. A latest report additionally recommended that Samsung lately rejected a provide demand from its personal cellular division for RAM, because it desires to spice up profitability. This determination got here from Samsung’s semiconductor division, often called DS. So, what’s prompting this value hike? Why are RAM costs rising? It largely has to do with synthetic intelligence. Learn on.
AI and the ever rising want for knowledge facilities
As synthetic intelligence advances and the necessity for compute will increase, big-name corporations like OpenAI, Google, and Meta are getting down to construct greater and higher infrastructure. They’re constructing massive knowledge centres to facilitate this. Proof of this may be seen in corporations like Google opening massive knowledge centres in locations akin to Visakhapatnam. A report by The Financial Occasions famous that Adani Enterprises partnered with Google to construct India’s largest knowledge centre campus in Visakhapatnam. Relating to these knowledge centres, the position of RAM and storage turns into paramount. Why? GPUs powering AI want RAM: Excessive Bandwidth Reminiscence.
How GPUs are consuming up house for consumer-grade RAM?
For synthetic intelligence fashions to work and practice, there’s a big want for AI chipsets akin to NVIDIA’s GPUs. And for the GPUs to be made, a key part is Excessive Bandwidth Reminiscence (HBM). To fabricate HBM, corporations like Samsung, SK Hynix, and Micron need to sacrifice the manufacturing of ordinary RAM akin to DDR5.
Principally for reinforcing income, producers are prioritising HBM for AI workloads. This leaves much less capability for consumer-grade RAM, inflicting a scarcity and additional driving up costs. In reality, the difficulty is so extreme that Micron, a significant participant within the reminiscence house, lately introduced that it might shut down Essential, which was identified for its consumer-grade RAM, particularly for gaming, to focus totally on AI and direct B2B prospects. General, the rising demand for high-bandwidth reminiscence is resulting in a scarcity of standard shopper RAM.
Analysts predict that provides might be constrained and smartphone costs might be elevated
IDC analysis predicts that offer constraints may push costs larger, which might largely impression low-to-mid-range Android gadgets, as they’re extremely price-sensitive. Smartphone shipments, in response to IDC, may see a mushy decline in 2026. IDC additionally states that distributors might want to undertake totally different methods to guard their market share, and whereas some OEMs will inevitably want to extend costs.
“As reminiscence elements change into extra restricted and dearer, producers face rising strain to lift costs,” stated Anthony Scarsella, analysis director with IDC’s Worldwide Quarterly Cell Telephone Tracker. “Distributors must undertake totally different methods to guard their market share. Whereas some OEMs will inevitably be pressured to lift costs, others will regulate their portfolio in the direction of pricier fashions with larger margins to soak up among the reminiscence impression on BOM.”
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