Lead Hook
When consumers expect older devices to become cheaper, the sudden surge in prices feels like a betrayal. The price hikes at Apple, Microsoft and Nintendo are not simply about profit margins – they are a symptom of a deeper supply‑chain shift: AI‑powered data centres are outbidding consumer electronics for the same memory chips, turning a once‑stable component market into a battlefield of competing priorities.
According to the BBC, this is the first time in years that older tech is becoming more expensive, a reversal of the long‑standing trend of depreciation.
Deep Dive
The crux of the issue is DRAM – the volatile memory that lets devices run applications in real time. Over the past year, DRAM prices have more than doubled as AI data‑centre demand has outstripped existing capacity.
As the BBC quotes Danni Hewson, head of financial analysis at AJ‑Bell, “The race to build out AI data centres is resulting in a swift and significant increase in demand that chip makers are rushing to meet.” This shift forces firms like Apple, Microsoft and Nintendo to absorb higher component costs and pass them on to shoppers.
Apple responded by raising the prices of its tablets and laptops by roughly 20 %, a move that immediately knocked its share price down. Microsoft announced a minimum $100 (≈ £75) price increase on its five‑year‑old Xbox Series S and X consoles, pushing new‑console prices up by 30‑40 % compared with the previous year. Nintendo confirmed a global price increase for the upcoming Switch 2, scheduled for launch later this year.
Analyst Yang Wang of Counterpoint Research is quoted as saying the memory crunch is “the most disruptive supply‑side event the smartphone industry has ever faced” and that even premium makers such as Apple and Samsung are feeling the pressure.
Future Outlook
If AI‑driven demand continues to outpace DRAM supply, consumer‑electronics manufacturers may face a new pricing paradigm where price stability becomes the exception rather than the rule. Smaller competitors lacking the financial muscle to secure long‑term chip contracts could be forced out of the market, accelerating consolidation among device makers.
Regulators may begin scrutinising the allocation of semiconductor capacity, especially if price hikes disproportionately affect lower‑income consumers. Potential policy responses could include incentives for diversifying memory‑chip production or encouraging fab capacity dedicated to consumer‑grade components.
In the medium term, companies might explore design adaptations that reduce reliance on high‑end DRAM, such as greater integration of on‑chip memory or leveraging emerging memory technologies. However, such shifts require time and capital, meaning price pressures are likely to persist throughout 2026 and beyond.
For consumers, the immediate takeaway is clear: the era of cheaper older devices is over, and the cost of staying current will increasingly reflect the hidden competition between AI data‑centres and everyday gadgets.
“The race to build out AI data centres is resulting in a swift and significant increase in demand that chip makers are rushing to meet.”
— Danni Hewson, AJ‑Bell, cited by the BBC.