Why AI Is Making Things More Expensive

Apple has raised prices on MacBooks and iPads. The PS5 costs more today than when it launched over five years ago. Samsung's Galaxy smartphones are pricier. Analysts predict the primary smartphone market could decline by 14.8% in 2026—a record drop. The culprit, according to Atlantic reporters Alex Reisner and Hannah Kiros, is something most consumers have never heard of: a memory crisis, or as some in the industry call it, the "RAMpocalypse."

What's Actually Happening to Memory Chips

The story begins with RAM—random access memory, the short-term memory in every computer, phone, TV, gaming console, and even many modern cars. Prices for certain memory chips have tripled or quadrupled in recent quarters. The reason is straightforward: generative AI companies are consuming memory at an unprecedented rate.

Large language models require enormous amounts of high-speed, high-bandwidth memory to operate. As AI companies pursue bigger and bigger models, their hardware demands have exploded. Reisner reports that these companies are now planning to increase data center capacity by eight times—a massive expansion compared to the previous twenty years. Nvidia, the dominant AI chipmaker, is purchasing roughly 70% of the world's supply of high-end computer memory.