Memory prices have surged 500% in 12 months, turning RAM from a quiet part of the technology business into one of its biggest cost pressures. The global shortage comes from AI demand, as chip makers focus on the memory needed for data centers instead of the different chips used in consumer electronics.
The impact is already reaching TVs, laptops, game consoles, smartphones, and other devices. RAM now costs about as much per unit as it did in 2007, while 128GB DDR5 kits are ten times more expensive than their lowest price ever seen. This has reversed the long-running expectation that memory would keep getting cheaper and more capable over time.
AI data centers are consuming the supply
The basic problem is simple: demand has moved faster than supply. As Nic Puckrin put it, “It’s a simple supply and demand equation.” Russ Renzas described the same pressure as “‘Chipflation’ is a consequence of an unusual demand spike due to AI.”
AI data centers need huge amounts of memory, and chip makers can earn more by supplying those facilities than by selling chips to companies that build televisions or other consumer products. “The companies that make chips earn far more money selling to AI data centers than to the firms that build your television, so they have shifted their factories to serve AI first,” Asif Alam said.
Renzas explained why that shift has created a shortage for ordinary electronics: “The reason supply is so tight is that there’s so much demand for the chips that power AI data centers right now that chip makers are focusing on making these instead of the chips that go into consumer electronics, which are different.”
The scale of AI memory demand is clear from large data center projects. Memory used in xAI’s Colossus site could reach 112,005,000GB of RAM, equal to the memory in 14,000,625 iPhones or 9,333,750 Galaxy S26s. An OpenAI deal with AMD, signed in October 2025, covers 6GW of AI data centers, and its first 1GW site could use GPUs with a maximum RAM capacity of 432GB, potentially requiring up to 194,400,000GB of RAM.
Consumers are paying for the shortage
DRAM prices rose from as little as 90 cents per gigabyte in August 2024 to $3.45 per gigabyte in July 2026. That increase changes the cost of finished products, especially devices that need larger memory capacities.
Memory once made up 2% to 3% of a television’s total cost. It now represents 6% to 7%, according to Renzas, who said, “These costs will invariably be passed on to consumers, generally at [around a] 200 percent markup, so TV prices might be up 10 percent due to the memory shortage.”
Laptops face an even bigger hit because they need more memory than many other consumer devices. “Devices that have more memory-intensive needs – laptops, for example – cost 20 percent higher or more because of chipflation,” Renzas said.
Game consoles have already reflected the pressure. Nintendo raised the price of its Switch 2 by $50 in May 2026, while Sony increased PlayStation 5 prices by as much as $150. In July 2026, Apple CEO Tim Cook said the company was raising prices by $150 to $300 across its product lineup because of memory chip prices.
The squeeze is also showing up in chip industry results. Micron reported quarterly income of $28.86 billion in June 2026, and SK Hynix reported record-breaking revenues in July 2026. Those figures show how valuable memory has become while buyers face higher prices across the hardware market.
New factories will not solve the problem soon
Memory chips rank among the world’s highest-value commodities by weight. Mainstream DRAM chips are worth more than half as much per kilogram as solid gold, which helps explain why manufacturers are willing to spend billions expanding production.
That expansion takes time. Building a new RAM manufacturing factory costs billions of dollars and requires years of development, so higher prices cannot disappear as soon as companies announce new facilities. SK Hynix committed to building two new memory factories in South Korea at a combined cost of $38.1 billion, but production is not expected to begin until June 2029.
Experts expect the shortage and high prices to last beyond 2028, with demand exceeding supply until at least 2030. Cassandra W.G. Cummings put the near-term outlook plainly: “I doubt these will ease before 2028.”
That timeline leaves consumers facing a long period in which more memory can mean a much higher price. AI companies continue to build data centers, while manufacturers work through a supply problem that cannot be fixed with a single factory or a short production run.
Based on
- [AINews] Memory prices up 500% in 12 months — latent.space
- Your laptop costs a lot more now. The reason: ‘Chipflation’ | The Independent — independent.co.uk
- Why Are RAM Prices So High Right Now? — engadget.com
- What is ‘chipflation’ and why is it making all your electronics more expensive? | The Independent — independent.co.uk
