Are consumers ready to say goodbye to the rule that "hardware gets cheaper every year"? Counterpoint's latest data answers it: over the past 12 months, DRAM spot prices have roughly quintupled, with contract prices rising another 10–20% each quarter. IDC added that manufacturers and retailers have already passed that cost pressure on to consumers, with some categories hiking prices by up to 20%.

Put the two numbers side by side and the picture is clear: DRAM is the core component in nearly every consumer electronic — smartphones, PCs, routers, set-top boxes — none of them escape. A 5x component price surge layered on top of a 20% end-product increase is not a "slight bump," it's a full-scale cost repricing across the consumer electronics industry.

Who's eating DRAM capacity

Two years ago, DRAM was in chronic oversupply, with memory modules and SSDs hitting historic lows. The picture has fully reversed, and the root cause is the AI data center's enormous appetite for high-bandwidth memory (HBM). Samsung, SK Hynix, and Micron — the three majors — have shifted nearly all of their most advanced DRAM lines to HBM, because a single HBM chip costs several to over ten times a regular DRAM chip, and AI buyers place long-term, high-volume contracts with reliable payments.

Counterpoint research director MS Hwang summed it up directly: "Almost every consumer electronics category is being affected by the shortage."

Conventional DRAM capacity has been pushed to the margin by HBM. The fabs that everyone was counting on for expansion can't pull consumer-grade DRAM supply back into balance in the short term either, because of equipment lead times and AI customers' priority allocation.

How the money moves from supply chain to consumer

The 20% figure from IDC corresponds to price hikes that manufacturers and retailers have already executed. Another counterpoint figure: over the past year, the DRAM used in a single smartphone has risen by as much as $250. MS Hwang expects this cost to be passed into handset prices this autumn.

In other words, from late 2026 into early 2027, anyone buying a new phone will see a very direct price curve: a mid-to-high-end model will cost several hundred yuan more than its late-2025 counterpart (mapping to that $250 BOM increase). Mid-to-low-end models are less exposed in percentage terms, but absolute prices are still moving up.

Telecom gear is under the same pressure. Nokia CEO Justin Hotard publicly said the company is redesigning some products to use less memory. He noted the chip shortage is affecting Nokia's mobile, broadband, and internet routing equipment, and that he expects the shortage to last into 2027. A telecom giant shipping hundreds of millions of devices a year, forced to "redesign products" — that is not a temporary patch, it's a structural change that has to be baked into the next-generation product roadmap.

Consequences don't stop at "higher prices"

Price hikes are the surface effect; the real structural shifts hit three layers at once.

First, product definitions get rewritten. Routers, set-top boxes, smart speakers — devices that used to sell on "more memory is better" — will now compress memory specs much more aggressively. Products that ran fine on 1GB may be cut to 512MB or even less; devices that were supposed to run a local LLM assistant either get more expensive or move inference back to the cloud.

Second, consumer behavior gets postponed. Persistent higher prices push consumers to keep their existing devices longer. Refresh cycles that used to be 2–3 years get stretched further, and the second-hand market gets a small boom.

Third, on-device AI rollouts get delayed. Local inference was supposed to be the clear direction for consumer electronics from 2025–2026: phones, PCs, routers all running small built-in models. If DRAM stays expensive, those small models either get smaller, or continue leaning on servers, pushing the "local AI" promise further out.

Short term: capacity. Long term: the "AI-first" narrative

The relief lever is when consumer-grade DRAM capacity actually comes back. Looking at the industry rhythm, the three majors' 2026–2027 new fabs are still ramping, and their priority is still satisfying AI customers' HBM orders — incremental supply released to consumer channels is limited. MS Hwang and Nokia's CEO both see the shortage lasting into 2027.

That means from late 2026 to 2027, the consumer electronics industry will go through a full "AI-first" cost reallocation. AI vendors are willing to pay a premium for HBM, so the majors naturally tilt their advanced capacity that way; consumer electronics makers either accept price hikes that compress margins, redesign products to cut memory, or delay launches. None of the three paths is easy.

For ordinary users, over the next 12 months, when picking a new phone, a new router, a new PC, you'll need to pay much closer attention to memory specs and price curves than you did in recent years. The Moore's Law era of "next generation is cheaper and more powerful" really has hit pause against this new variable called AI.