Fate of Reality

September 2, 2026

Why Your Next Phone and Laptop Cost More

The chip that lets your phone switch between apps went from under five dollars to nearly sixty in a year. Three companies make it, and they'd rather sell to data centers.

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The facts:

  • A 16-gigabyte memory chip that sold for as little as $4.76 last year cost almost $60 by June (WA Data Science Innovation Hub, via ABC Australia)
  • 128-gigabyte DDR5 memory kits are ten times their lowest-ever price; big cloud buyers have reportedly locked in almost all of the world's DRAM production for 2027 with advance deposits, and mainstream memory chips are now worth more than half as much per kilogram as gold (Tom's Hardware, via Latent Space)
  • Three companies, Micron, SK Hynix and Samsung, make over 90% of the world's DRAM, and they've shifted production toward the high-bandwidth memory that AI servers use, where the margins are higher (ABC Australia)
  • Samsung raised prices on phones and tablets, up to $115 more for higher-storage models in Australia; Microsoft, Google and Apple have raised prices on phones, computers and tablets in recent months; Valve delayed new hardware and priced its Steam Machine at $1,049, hundreds above earlier estimates (ABC Australia)
  • SK Hynix's chairman said in March the shortage could last into 2030, because adding wafer capacity "takes at least four to five years" (ABC Australia)
  • Research firm Omdia says low-end electronics are "becoming unprofitable," and some makers are going back to older, cheaper screens and cameras to absorb the cost of memory (ABC Australia)
  • Apple released new Mac minis and Mac Studios early because business demand for AI hardware surprised it; many configurations have been out of stock for months, and Mac revenue rose 29% to $10.4 billion last quarter (The Information via MacRumors, The Decoder)
  • OpenAI and other labs have bought tens of thousands of Mac minis to train agents that operate a computer; Anthropic rents them through Amazon (The Information via The Decoder)
  • Goldman Sachs expects AI supply and demand to stay out of balance until the first half of 2028, with memory and chip prices higher than six and twelve months ago (Yahoo Finance)
  • China's CXMT is producing its first high-bandwidth memory in small quantities, a generation behind, with yields estimated near 25% (The Information and SemiAnalysis, via The Decoder)
  • Politico reports the administration could impose broad semiconductor tariffs within "weeks or months," possibly on finished products that contain chips; an industry group estimates that would cost $90 billion a year in GDP and delay a fifth of planned data centers (Ars Technica)

Nobody thinks about the memory chip. It's the part that lets a phone hold six apps open at once, and it has spent thirty years getting cheaper every year like clockwork. That clock ran backwards this year.

The reason is boring and complete. There are three companies on earth that make this stuff at scale. A data center full of AI servers needs a different, faster kind of memory, stacked next to the processor, and it needs thousands of servers' worth at a time. A cloud company will pay a real margin for that. A phone maker buying ordinary memory pays close to cost. So the three factories retooled toward the customer with the deep pockets, and the ordinary chip got scarce.

Then the deep pockets did the thing deep pockets do. They put down deposits for next year's production. Reportedly most of it.

where it lands

Samsung already raised prices. So did Apple, Google and Microsoft. Valve pushed a console back and then priced it hundreds of dollars higher than anyone expected. The research firm Omdia says the cheap end of the market, the $150 phone and the $300 laptop, is turning unprofitable, and some makers are swapping in older screens and cameras to make the numbers work. The memory chip is now the most expensive part in a budget phone.

That's the part that hits people who don't follow any of this. The person who buys a phone every four years, on the cheapest plan, walks in this fall and the entry model is either gone or a hundred dollars more.

the Mac mini thing

There's a smaller story inside the big one. The labs building the agents that operate a computer for you need actual computers to train on, and the cheapest good one turns out to be a Mac mini. OpenAI bought tens of thousands. Apple, which by The Information's account had no enterprise AI plan and no team for it, found its desktop line sold out for months and shipped new models in August instead of October to catch up. Mac revenue up 29% in a quarter, on a product they thought was for editing home videos.

So the same shortage shows up twice: it makes your laptop pricier, and it makes the small desktop the AI companies want harder to get. The company selling the thing is as surprised as the person buying it.

how long

The honest answer from the people who make it is years. New fabs take four or five to bring up. Goldman's guess is that supply and demand don't meet until 2028. China's memory maker is a generation behind and throwing away three chips out of four. And the one policy on the table, tariffs on chips and possibly on everything with a chip in it, would push prices the same direction.

A Geelong artist told ABC she saved for a graphics card upgrade two years ago, watched the price climb every month, and gave up. "I've missed the boat," she said. The boat is the same one the data centers are on, and it left with all the seats sold.

Sources: ABC Australia, Tom's Hardware via Latent Space, The Information via MacRumors and The Decoder, Yahoo Finance, SemiAnalysis via The Decoder, Politico via Ars Technica.