Shortages in the computer parts industry are driving up the price of technology across the board, causing a chain reaction of effects that will impact tech procurement for UA students and faculty alike.
The rapid growth of AI companies has drained the supply of necessary components like DRAM and solid-state storage, which can be found in everything from smartphones to cars to data centers to factory machinery.
The most noticeable market squeeze is in the DRAM industry. DRAM is computer memory, a component that allows computers to temporarily store information retrieved from storage, hard drives or solid-state drives. It’s created in sheets called wafers in factories called fabs that cost tens of billions to create, double that if they’re built in the United States.
Three companies — Samsung, SK hynix and Micron — control 95% of DRAM production, and the latter has completely discontinued its consumer-grade memory to supply AI data centers.
“Every wafer allocated to an AI data center is effectively a wafer denied to a consumer laptop or smartphone,” said Byung-Choel Kim, a professor of economics at the University who specializes in industrial supply chain research. “OpenAI’s Stargate project alone reportedly requires 900,000 wafers per month — roughly 40% of global DRAM output.”
Unlike the global tech shortages during the COVID-19 pandemic, Kim said that the ongoing RAM shortage is endogenous — not the fault of outside forces and instead the product of a concentrated market dynamic. RAM prices used to be so low that all other manufacturers, including massive companies like IBM, Texas Instruments and Intel, couldn’t justify the immense cost and left the market. The three extant manufacturers purposefully scaled back production after the pandemic to raise prices, securing safer profits but leaving them unprepared for a sudden spike in demand.
Kim said that the increased demand and low supply leave consumer product manufacturers with a choice: “raise sticker prices or cut specifications.” Some companies are cutting down on the DRAM included in their products while others, such as pre-built PC providers, are selling models without DRAM and asking purchasers to source their own. These price increases are impacting everyday tech used across the University.
“Universities are large purchasers of IT equipment,” Kim said. “Computer labs, research servers, and classroom technology all face the same cost pressures.”
Michael Pierce, director of strategic engagement at University Libraries, said that he was not aware of any changes happening within the University Libraries system in response to technology pricing. He said that University Libraries has been removing some computers and replacing them with display docks, a response to the increased prevalence of personal devices among students.
While Culverhouse’s Technology Group did not respond to requests for comment, students are beginning to see the effects in their own personal electronics purchases. Market surveys indicate that average RAM prices have more than tripled in the past year..
“I’m glad I built my computer when I did and that I actually decided to go for higher end specs for once because I’m gonna need this computer to last me,” said Matthew Siegmund, a second-year Doctor of Musical Arts student who built his own gaming computer. “Especially as a grad student, I don’t have the money to just spend a grand on RAM.”
PC gaming enthusiasts like Siegmund have been among the hardest hit by the market for PC components. To keep up with the technical demands of modern games, PC owners have to purchase parts that come with higher specs, often at eyewatering costs.
Sixteen gigabytes of memory, considered the bare minimum for PC gaming in 2026, can cost upward of $700 in the highest performing DDR5 models. Many gamers have had to settle for discontinued DDR4 or decades-old DDR3 memory, causing the popularity of long-outdated motherboards to soar.
Those that want to buy cheaper hardware may fare even worse. Kim said that companies that make budget devices may be forced out of business by the rising price of components.
“A lot of people don’t think about how much RAM is needed for everything, especially with the car industry and all of them needing glorified tablets plastered onto their dashboards,” Siegmund said. “They don’t realize how much RAM that takes, how much their phone takes.”
Kim said he expects prices to peak later this year, but they may not settle down until 2027 at the earliest. To students, he said that buying now may be the best move, even if stockpiling is a driving factor in the current price.
“The shortage is regressive: It hits price-sensitive consumers hardest,” Kim said.
