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The End of Low Memory Prices
In 2023, high-performance NVMe SSDs were priced similarly to entry-level HDDs. DRAM was on a similar path, driven by overproduction that pushed prices downward. This trend abruptly ended when manufacturers cut back on their output to halt the plummeting prices.
Within months, the market shifted dramatically. According to Tom’s Hardware, prices for TLC NAND have doubled, DDR4 is on the rise, and HDDs are now being rationed. The era of low-cost upgrades is over.
AI: The New Market Driver
The shift’s origin is clear and unsurprising: generative AI. The infrastructure required to train these models relies on GPU clusters boosted with high-capacity DRAM and SSDs. Each AI node consumes several hundred gigabytes of memory and multiple terabytes of storage. According to Tom’s Hardware, OpenAI has secured up to 900,000 DRAM wafers per month, nearly 40% of the global production. Hyperscalers are adopting a similar strategy, locking down supplies for several years. Consequently, traditional supply chains are suffocated.
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Shifting Focus to Premium Clients
Faced with this demand, manufacturers are redirecting their investments. Goodbye to DDR4 and TLC NAND for consumers. Funds are now flowing towards HBM memory and QLC modules for servers. Even hard drives are feeling the pressure, especially those designed for data centers, affected by the scarcity of permanent magnets and Chinese restrictions on rare earths. According to Tom’s Hardware, delivery times for some HDDs now exceed a year. The increasing adoption of flash alternatives in these applications further exacerbates the tension on NAND.
Few Short-Term Solutions
Building new factories won’t be enough in the short term: high costs, long lead times, and strained equipment. Manufacturers prefer a strategy of profitable scarcity rather than repeating the scenario of 2019. According to several analysts cited by Tom’s Hardware, this situation could last a decade. Professional clients are prioritized, and consumers will need to adapt.
What’s Being Said?
Apple, like others, cannot completely escape this tension. While the brand designs its own chips and optimizes its memory needs, it still relies on suppliers like SK Hynix and Samsung for DRAM and NAND. These components are found in Macs, iPads, iPhones, and also in future servers tied to its AI ambitions.
In the short term, there’s little risk of disruption for high-end products, as Apple has the capacity to secure volumes. However, more accessible devices like the Mac mini or certain entry-level iPads might see prices increase or configurations stagnate.