Indications of a worldwide memory chip shortage appear at computer stores.
The build-your-own-PC market has become far more expensive due to surging memory chip prices, in what might foreshadow price increases elsewhere for Indian electronics.
At Nehru Place in the national capital, the beginnings of a looming pricing crisis in personal electronics is taking shape, as customers and retailers in the sprawling market struggle to get hands on RAM sticks and SSDs used in desktop PCs, laptops and smartphones.
Over the last few weeks, prices of these components have surged with little precedent, beyond even the levels seen during the COVID-19 pandemic, as Al hyper scalers globally crowd out a supply chain that now has less room for consumer-grade products.
At Manoj PC Wala, a single stick of DDR5 16GB RAM that until November was selling for about 15,000 at worst now bears a fresh MRP sticker. The current price is ₹15,000. “SSD prices have doubled, and RAM prices have increased four times,” Subhash, one of the store’s attendants, said. Price data for these components re-viewed by The Hindu con-firm this assessment.
In early December, one of the few importers of RAM sticks, typically pre-installed in pre-built PCs or laptops (and less frequently sold individually to enthusiasts or businesses), provided retailers an opportunity to purchase inventory in bulk at the current prices. Suppliers cautioned that prices would continue to increase from that point, Pramod, another attendant, mentioned. Many retailers hesitated, either unable or unwilling to take the risk of the deposit this deal required. Currently, prices for RAM and SSDs are soaring, and this upward trend may continue in the coming months
Consumer electronics
The primary issue stems from three companies dominating the microchip market’s supply chain: SK Hynix, Samsung, and Micron. These companies have been inundated with requests for chips utilized in AI data centers by major tech firms that outbid prices of consumer electronics manufacturers. Micron has also declared that it will close down Crucial, its consumer RAM brand
The full impact of the price shock this situation will lead to in the absense of the trio ramping up production-will be felt in the coming months. Electronics markets such as the Nehru Place cater to a small portion of consumers, who build their own hardware. Largescale original equipment manufacturers (OEMs) such as Dell, HP and Asus often have long-term supply agreements that protect them from immediate price jolts.
But even these firms are preparing for price adjustments. Dell has already announced plans for raising prices of laptops sold to enterprise clients, sparing in dividual buyers for now.
The main issue arises because three companies dominate the supply chain of the microchip market: SK Hynix, Samsung, and Micron. These companies have been swamped with requests for chips utilized in AI data centers by large tech firms that outbid prices of consumer electronics manufacturers. Micron has also declared plans to close Crucial, its consumer RAM brand
Even smartphone makers may have to scale down the level of RAM or memory they offer at a given price point, or hike prices. While smartphone prices are now only hit at low-budget lineups, price shocks “could spread across the broader smartphone and consumer electronics ecosystem,” Ivan Lam, analyst, Counter-point Research, wrote in a note. As India’s smart-phone market is on the right side of a recovery in shipments, the shock may impact the recovery.
Regarding custom PC builders, who often operate under the accurate belief that building their own PC is more cost-effective than purchasing a prebuilt model, they are currently less inclined to spend on items that require a separate RAM purchase, according to Subhash
“What they thought they could build for 250,000 now costs 270,000,” he says. “So they’re buying.”
