First, AI<\/a> was coming for your job<\/a>. Now, it\u2019s coming for your device memory.<\/p>\n Soaring demand for computing memory, known as \u201cchipflation,\u201d has increased costs<\/a> for memory chips used in everything from hulking data centers<\/a> to TVs, computers and streaming consoles. <\/p>\n \u201c\u2019Chipflation\u2019 is simply the term for rising electronics prices caused by surging memory chip prices \u2013 the key components in consumer electronics like laptops and PCs \u2013 as a result of a massive supply squeeze,\u201d said Nic Puckrin, founder of Coin Bureau, an education channel for retail crypto investors. <\/p>\n The cost of memory has risen at a staggering rate over the past two years. DRAM, which is the type of memory the typical computer or phone uses, cost as little as 90 cents per gigabyte<\/a> in August 2024, according to Stanford University. That price jumped to $3.45 per gigabyte in July, an increase of nearly 400 percent. <\/p>\n Consumers can thank AI<\/a> for that, said Russ Renzas, a cleanroom director at the University of Nevada, Reno.<\/p>\n \u201cChipflation is a consequence of an unusual demand spike due to AI,\u201d he told The Independent in an email. <\/p>\n Manufacturers are responding to the demand by prioritizing manufacturing for AI data centers rather than the average person, Puckrin said. <\/p>\n \u201cThe reason supply is so tight is that there\u2019s 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,\u201d he said. \u201cThat\u2019s exacerbating the shortage and driving prices even higher.\u201d<\/p>\n Other factors are at play in the memory chip market, too. Puckrin pointed out that two memory-chip makers, South Korea-based SK Hynix and Samsung, control 70 percent of the market. <\/p>\n They already have enough orders to exceed supply this year, he said, so they have a rare luxury. <\/p>\n \u201cThey can set almost any price they want, within reason, and consumer electronics makers will be forced to buy these chips,\u201d he said. \u201cIt\u2019s a simple supply and demand equation.\u201d<\/p>\n And it\u2019s not just that manufacturers are filling orders and raising prices; it\u2019s that they\u2019re prioritizing AI data centers over the average consumer, said Asif Alam, an electrical engineer and president of Florida International University\u2019s Engineering Research Society. <\/p>\n \u201cThe 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,\u201d Alam told The Independent in an email.<\/p>\n So, as factories churn out memory chips for AI data centers, consumers tend to get the expensive end of the memory stick. <\/p>\n Not only are chips in short supply, but companies that buy them for phones, computers, tablets and such are paying much higher prices than they used to, said Cassandra W.G. Cummings, CEO of custom electronics design and manufacturing company Thomas Instrumentation Inc.<\/p>\n As a result, consumers are paying higher prices for popular technology ranging from memory kits for computers to well-known gaming consoles. <\/p>\n \u201cNintendo raised the price of its Switch 2 console and directly blamed higher memory costs,\u201d Alaf said. \u201cSony and Microsoft raised their console prices too. Televisions, laptops, phones, consoles, and even cars are all affected because they rely on the same chips.\u201d<\/p>\n![\"Big-name](\"https:\/\/www.europesays.com\/ie\/wp-content\/uploads\/2026\/08\/2283305765...jpeg\")
Big-name electronics companies such as Apple, Nintendo and Sony have implemented or announced price increases due to a shortage of memory chips (Getty)<\/p>\n![\"Nintendo](\"https:\/\/www.europesays.com\/ie\/wp-content\/uploads\/2026\/08\/2217988757...jpeg\")
Nintendo raised the price of its Switch 2 by $50 earlier this year because the cost of memory chips has skyrocketed over the past couple of years (AFP\/Getty)<\/p>\n