As AI gobbles up chips, prices for devices may rise

Summary

Idaho-based Micron Technology is one of the world's top makers of RAM chips and it's benefited from increase demand. Charlie Litchfield/ASSOCIATED PRESS/FR164915AP hide caption toggle caption Charlie Litchfield/ASSOCIATED PRESS/FR164915AP The world has a memory problem, thanks to artificial intelligence. The explosion in AI-related cloud computing and data centers has led to so much demand for certain types of memory chips that now there's a shortage. The imbalance is expected to start affecting prices of all sorts of products powered by technology. "I keep telling everybody that if you want a device, you buy it now," said Avril Wu, a senior research vice president at TrendForce, a Taiwan-based consultancy that tracks markets for computer components. "I myself bought an iPhone 17 already," The chips are known as RAM, or random access memory, and are crucial to making sure that things like smartphones, computers and game consoles run smoothly. Chips allow you to keep multiple tabs open in browsers, for instance, or watch videos without them being choppy. Wu said TrendForce's data indicates that demand for RAM chips exceeds supply by 10% – and it's growing so fast that manufacturers are having to shell out a lot more to buy them each month. Wu said this quarter alone, they're paying 50% more than the previous quarter for the most common type of RAM, known as DRAM – dynamic random access memory. And if producers want the chips sooner, they're paying two to three times more. Wu expects DRAM prices to rise another 40% in the coming quarter, and she doesn't expect the prices to go down in 2026. How AI is gobbling up memory AI data centers require huge amounts of memory to accompany their cutting-edge graphics processing unit (GPU) microprocessors that train and operate AI models. "AI workloads are built around memory," said Sanchit Vir Gogia, CEO of the tech advisory firm Greyhound Research. What's more, AI companies are spending billions of dollars constructing data cent...