Why Budget Laptops and Phones Are Vanishing From Store Shelves

The Big Takeaway: AI Is Killing the Truly Cheap PC

Budget laptops and phones are disappearing because exploding demand for memory in AI servers is driving up RAM and storage costs, making sub-$500 devices unprofitable to build and forcing manufacturers to abandon the lowest price tiers or raise prices sharply, leaving cost-conscious shoppers with fewer options and worse value for their money. That is the uncomfortable truth behind today’s budget laptop prices rising and the broader chip shortage hitting budget devices. The industry is quietly deciding that if you can’t pay more than $500, you’re no longer worth serving. As memory costs spike and cheap PCs have no room to absorb those increases, the market is shifting toward pricier configurations and leaving the most cash-strapped buyers stranded at exactly the moment technology is supposed to be getting smarter and more accessible.

RAMageddon: How AI Servers Hijacked the Memory Market

The root of this squeeze is simple and brutal: AI data centers now outbid everyone else for memory. Memory makers are diverting production capacity to chips used in higher-priced AI servers, which is squeezing supplies of DRAM and NAND for PCs and smartphones. The result is an "ongoing memory shortage" where producers make it a priority to manufacture chips for AI data centers over other tech. DRAM prices have increased by an eye-watering 700% over the past four years, a shock that no entry-level product line can quietly swallow. According to market data, 32GB DDR5 kits that once fell to USD 72 (approx. RM331) now start at USD 369 (approx. RM1,699), while comparable DDR4 kits sit at USD 193 (approx. RM889). When your core components cost that much more, selling a cheap laptop or phone becomes a charity project—and big brands are not in the charity business.

Sub-$500 PCs: A Vanishing Species

The impact on budget hardware is blunt: entry-level systems are being priced out of existence. Unit sales of sub-$500 PCs dropped 18.7 percent in Q1 as rising dynamic random-access memory (DRAM) and NAND flash costs pushed vendors toward machines with more pricing room. Low-end PCs have fewer ways to hide component inflation, and entry-level systems have little margin to absorb increases without losing their low-price appeal. Rising component costs are eroding vendor margins on these devices, making them commercially unviable. So manufacturers pivot upward. Average selling prices have climbed past USD 1,000 (approx. RM4,610), and analysts expect prices to rise further, keeping entry-level prices elevated through 2027 and suppressing consumer demand. Budget buyers see the squeeze as a thinner cheap-PC shelf, where the few remaining options look underpowered or are replaced by midrange models that cost far more than last generation’s bargains.

Consoles, Handhelds, and Phones: No Escape From Memory Cost Impact

This is not just about laptops. RAMageddon is affecting anything with a built-in SoC. Sony, Microsoft, and Nintendo have all announced higher prices for their consoles as component costs surge. Handheld gaming PCs like the MSI Claw 8 EX AI+ and the OneXPlayer APEX arrive with astronomical prices that mirror their swollen memory bills. Smaller brands are retreating completely: AYN was forced to shelve the Odin 3 Ultra, while Retroid retired the Pocket G2 and temporarily retired the 12GB Pocket 6. Meanwhile, a new class action lawsuit in California claims that Samsung, SK Hynix, and Micron intentionally restricted conventional DRAM supply and coordinated a pivot to high-bandwidth memory, with prices allegedly fixed since 2022. Much of the disruption was already assumed to stem from the explosion of AI, which even drove Micron to exit the consumer market entirely. Put plainly, the memory cost impact has turned once-affordable gadget lines into luxury categories or killed them off.

The Bill for AI: What Budget Shoppers Face Next

For budget shoppers, the future is harsher than many tech optimists admit. Supply is not likely to improve quickly, and PC shipments this year are forecast to shrink 14.4 percent compared with last year as higher prices and weak demand bite. Analysts expect memory costs to keep entry-level prices elevated through 2027—a de facto RAM shortage 2027 for cheap devices—while meaningful solid-state drive capacity expansion is not expected until late 2027 or 2028. Too much demand for too little supply means companies pass their costs on to consumers via upward-creeping prices. People who feel financially strapped are already feeling the pinch as back-to-school and holiday cycles loom. In practice, budget shoppers must either spend more or accept slower CPUs, less RAM, and smaller storage. Waiting for "the market" to fix this is wishful thinking. If you need a device, your realistic options now are buying refurbished gear or paying a higher base price and treating AI’s memory binge as a cost you can’t avoid.