With the AI boom and rising component prices, smartphone prices have been rising recently, with brands like Samsung and Apple announcing hikes, and others like Oppo, Vivo, and even Nothing doing the same.

This is making smartphone shopping in India harder, as higher component costs are driving up budget prices. With the holiday shopping season underway, people may find it harder to get the memory and storage they want for their money.

The problem isn’t just inflation or companies making high-end models. Higher prices for DRAM and NAND memory are driving up production costs. At the same time, demand from AI data centers is taking a share of the advanced memory chip supply.

This creates a challenge for phone makers trying to offer devices without sacrificing profit margins.

The effect is already happening in the market. Smartphone sales during India’s holiday season are expected to drop by 12% from the previous year, even as the total market value is expected to grow by about 5%. This mix suggests that people may spend more on phones even while buying fewer of them.

The pressure hits entry-level smartphones hardest. Companies in this price range have less room to absorb higher part costs because customers are very sensitive to even small price changes.

Companies can protect profits by raising prices, cutting back on deals, reducing memory or storage, or changing other features.

For shoppers, this means looking at phone features and prices rather than just the original launch price.

A phone advertised with 8GB of RAM and 256GB of storage might look good.

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