For any AI haters looking for more ammunition, here’s something you can use: pricier iPhones.
Driving the news: Outgoing Apple CEO Tim Cook said that price increases for Apple products are “unavoidable” in an interview with the Wall Street Journal, citing soaring demand and skyrocketing costs for memory and storage chips driven by AI servers.
“This is a hundred-year flood,” said Cook, referring to the exponential price increases for memory chips, “I’ve never seen anything like it in any area in over 40 years.”
Zoom in: According to a WSJ analysis, if Apple wanted to maintain similar profit margins for its next iPhone Pro, it could potentially raise the base price by US$200 to US$1,299 (about $1,830 Canadian). However, this calculation doesn’t account for potential upgrades to the phone’s camera, which could bump the price tag to US$1,399 (just shy of $2,000 Canadian).
Why it matters: Apple used to be top dog in the memory market, using its muscle as a customer to bully chipmakers into the lowest prices; that’s no longer the case. You might be saying, ‘that’s alright, I don’t use Apple products,’ but think about it — if not even Apple can stave off these price increases, what hope do other consumer electronics companies have?
With memory and storage prices quadrupling since last year and only getting higher, we’re living through RAMageddon, which threatens to push prices up on all sorts of devices.
Our take: If you need a new phone or laptop, consider buying it before the next release cycle.—QH
