AI-induced Memory shortage is changing how devices are built, Fairphone says memory now 60% of materials cost

The ongoing memory shortage, driven by surging demand from AI data centers, is reshaping how consumer electronics are designed and manufactured. Smaller device makers, such as Fairphone, report that m... Read original →

The surge in demand from AI data centers has triggered a severe DRAM shortage, fundamentally altering consumer electronics design and manufacturing. Memory now comprises nearly 60% of a device's material cost, forcing manufacturers like Fairphone and Framework to adopt modular strategies and reuse legacy components. SK Hynix forecasts 2027 as the peak year of the crisis, with supply chain disruptions expected to persist through 2030. This shortage is pressuring profit margins and forcing industry players to restructure supply chains, especially amid geopolitical tensions and tech decoupling between the US and China. Smartphone shipments are projected to decline significantly, accelerating the push for vertical integration and localized production. The long-term impact includes reshaped competitive dynamics, with early adopters of advanced memory architectures gaining strategic advantages.