There is a perfect storm with AI and data centers. And it will cause DRAM and NAND memories to become a luxury.

The prices of NAND flash memory, used in SSDs, and DRAM, used in PCs and laptops, are set to rise significantly. This shift follows a period of price drops that benefited consumers for two years, primarily due to oversupply. The increasing demand for data centers and the rise of AI are the main drivers behind this reversal in the market. In early 2023, both NAND and DRAM prices were in freefall, a consequence of overproduction during the pandemic. The market correction occurred as the initial surge in demand subsided and manufacturers were left with excess inventory. Now, the demand for high-performance memory is being fueled by AI and the rapid expansion of data centers, which require massive amounts of memory. This situation directly impacts consumers and businesses who rely on these components. The rising prices will likely lead to increased costs for new computers, laptops, and storage upgrades. The increased demand is specifically impacting the availability of memory types such as HBM, designed for enterprise applications, which are essential for the operation of AI systems. The trend is already visible in the price evolution of SSDs, with prices rising since mid-2023. The demand from the AI sector will continue to strain the supply of these components, potentially leading to further price increases. This situation highlights the impact of emerging technologies on the hardware market.