In 2025, this MacBook Pro cost $1,600.Less than a year later, the same laptopcost $400 more. Apple says it's because
of demand for memory and storage fueledby the [music] rapid expansion of AIdata centers. That's the exact same
reason Xbox gave for a $150 price hikeon its nearly 6-year-old console.Lenovo, Dell, and HP have all raised
prices, too, citing the same culprit.>> Just these seven drives alone is over $6or $7,000. When I [music] bought them,
they were probably about $1,500 all in.These prices aren't [music] tethered tonew technology. They've just gone up
because some center and some place needsthem more than I do. The narrative isthat AI data centers are buying up huge
amounts of memory and chips, causingshortages and skyrocketing prices foreveryday electronics. There's just one
issue. Data centers don't use the sametype of microchips as your phone orlaptop. And now the world's biggest
memory chip makers are being sued forallegedly colluding to inflate prices.So who or what is actually [music] to
blame? AI data centers or the companies
making the chips?
And could a moratorium on data centersactually force prices down?
To know what's really going on withese tech prices, we first need tounderstand three types of microchips.NAND, DRAM, and HBM. In terms of memory,
they work a bit like the human [music]brain. NAND is like your long-termemory. It holds on to information even
after a device is powered off.>> Think of an iPhone is the best example.If you take a lot of photos, a thousand
photos in a month or something like thatand they're on your phone, that'susually stored in in nan storage.>> DRAM [music] or dynamic random access
memory is your short-term memory, fastbut temporary, and it clears the momentyou switch the power off. HBM or high
bandwidth memory is essentially DRAM onsteroids. It's the same kind ofshort-term memory, but it's designed to
process much more data at once, morethan any human brain could. While NANDand DAM chips are used to power devices
like smartphones, tablets, computers,and smart TVs, HBM chips are used topower AI systems. All DRAM, NAND, and
HBM microchips start out as thin siliconwafers. The key point is that the moreof these tiny tiny cells and connections
you can cram onto a wafer, the more datayou can store onto that.>> HBM is a whole other level of storagecapacity. HBM takes one of those chips
and they stack them vertically next toanother one and then another one andthey're kind ofpackaged together in a kind of 3D shape.
When you mash all those chips together,you get a lot more memory. HBM can movedata 5 to 10 times [music] faster than a
standard DRAM chip. Its stack designalso makes manufacturing [music] HBMchips significantly more complex.
>> All that complexity just basically meansthat that they [music] um they're muchmore expensive to manufacture and
actually they take a lot more kind ofmanufacturing capacity.>> These HBM chips are the backbone of AIdata centers and demand for them is
through the roof. So if HBM is whatpowers AI, why is there a shortage ofthe other two types? It all comes down
to just three companies. Micron,Samsung, and SKHX.Together, they produce more than 60% ofthe world's NAND [music]
and nearly 90% of its DRAM. All threecompanies have shifted at least some oftheir production capacity to building
[music] HBM microchips. And the stockprices for all three companies jumpedmassively between June 2025 and June
2026.>> If you're a memory chip company,obviously you're going to go to the bestcustomers, and right now those are the
AI companies.>> That means less capacity to produce theother kinds of chips. This shift is nosurprise when you realize how central AI
has become to the US economy.>> Largest capital spending booms we'vever seen.>> Artificial intelligence is transforming
the economy right before our eyes. 80%of stock gains this year came from AIcompanies.>> Altogether, tech giants Google,
Microsoft, Meta, and Amazon [music] havespent more than $1 trillion on expandingAI since 2023.As of August 2026, [music]
there are 2,228new data centers in planning orconstruction stages across the US. Withless DRAM and NAND available, prices are
soaring. Thosehigher component costs land onelectronics companies, but instead ofcompletely absorbing the extra expense,
they're passing the bill onto customers.For instance, in [music] June, Xboxannounced it would raise the price of
its $512 GB Series S gaming console from$400 to [music] $500 and the 1 TBTEversion from $450 to $600. It alsoannounced it would be discontinuing its
two TBTE console. We went to a gamingtournament at OSNYC to see how gamersare taking the news.>> All right. All right.
>> You know, I was thinking about buying aXbox Series S and back then it was itwas nice and affordable. It was around
like $300 because of what's going on.It's up to $600. It's just out out of mybudget. The vast history of gaming is a
great story. I just hope that that storydoesn't have a bad ending coming soonwith uh with all the AI muck and penza.
>> And it's not just Xbox PC gaming gear isgetting hit, too.>> I was expecting to go buy a Steam Deck,but because of the AI bubble and what
he storage is, it's completely soldout. They finally stock, but theyincreased the prices just to match the
the current market. Xbox CEO AshaChararma has already said that thegaming industry is pricing out someconsumers. Price hikes like this are
xacerbating it.>> I may have to play gaming and startwatching sports.>> Frustration over Xbox's plans tocontinue raising prices into 2027 is
omething gaming YouTuber Luke Stevenshas seen firsthand.>> Who among you is buying that [music]for, let's say, $9.99? We're going to
let this scroll and see where you're at.Jesus, I see a good number of notes.[laughter]>> While Xbox [music] has not announced the
price of its next generation console,the company warned that console memoryand storage costs are expected to double
again by the fall of 2027. Theannouncement isn't surprising, but it itsure is disappointing. You know, we have
a 6-year-old console that is for the toptier variant, you know, approaching$1,000.So, can you only imagine what the new
one is going to cost? [laughter] You
know, like that's it's created a feelingof dread among a lot of the gaming[music] community where normally there's
excitement right around this time.>> Luke says these pricing trends areslowly changing the landscape of gaming.
>> I think they're going to start tobasically sell consoles like they sellcell phones where it's just yeah, you
get on a 2-year, threeyear plan orwhatever and that's just how it isbecause it is just getting to a pointwhere it's just not affordable for
people to own it outright. There's justnot that many people that can afford,especially right now, a 12 to $1,500
console. When all is said and done, itjust doesn't work. Like, the math isn'there. The thing is, Microsoft, Xbox's
parent company, is one of the companiesinvesting heavily in data centerexpansion. Business Insider mapped out
1,416built or approved data centers as ofJune 2026. 53 of those were built byMicrosoft, and many of them are massive.
Of the companies we tracked, only Amazonsurpassed Microsoft in large-scale datacenter construction. Microsoft expects
to spend roughly $175 billion on AI in2026 alone. So, if Microsoft is buyingenough HBM chips to run its datacenters, why won't it do the same for
its gaming division? The issue is there
simply aren't enough chips to go around.Even the most powerful companies arestruggling to get their hands on the
shrinking supply. Apple is one of if nothe largest purchaser of a lot of theselike memory modules and stuff at least
for consumerf facing hardware uh in[music] the world and so for them to befacing the same difficulties with
acquiring the pieces that they need tobuild the their electronics is prettyremarkable. Apple has kind of lost
control of the computer supply chain alittle bit lately because it doesn'thave a lot of AI data centers. Rising
memory prices are hitting the people whorely on storage to make a living.Atlanta commercial photographer Alan
Kulie says he typically spends anywherefrom $15,000 to $20,000 on storagedevices each year. The biggest price
hikes he's noticed are for solidstatedrives. These are more traditional SSDsor solid state drives that I use. This
a 4 TB SanDisk. [music] This is a twoTB SAM disc. These are Samsung's.They're T7s. These T5 drives, these are
like 1 TBTE. Just these seven drivesalone is over $600 or $7,000. When Ibought them, they were probably about
$1,500 all in. This is a 500 gig CFastcard. I use this when I'm doing um stuffwith my cinema cameras. My photo cameras
will use CFast or CF Express cards,[music] and they'll also use SD cards.All in, everything you see here is about
$7,500. If we were to go up to 200%,which is something I've definitely seen,we're talking about what is that 21,000
$22,000 for the same stuff that was just$7,000. [music]That's I could not have bought half ofthis stuff if the numbers were that
high.>> We had Allan compare the prices he paidfor storage [music] in the past withwhat they'd cost him today.
>> So, I'm looking at the blue 4 terbteSamsung T7.It is currently $889.Um, and that's a sale, but because it's
actually $1,144.99.When I go to my receipt for thesedrives, I bought it at the time for$285.That $285 drive is now well over $1,000.
I purchased this drive in April on April19th of 2025.April 19th of 2025 till July of 2026,we're talking about it has gone up over
200%.Crazy. But when I scroll through hereand I see the prices of SSDs today, andthe idea that they expect me to use my
hard-earned money to pay this much forsomething that was whatever 200% cheaperjust last year alone, they are bugging.
like Apple and Xbox, photographers couldsoon feel forced to [music] pass risingstorage costs on to their clients.
>> I am in this actual moment blown away.These prices aren't tethered to newtechnology. It's not that they went up
because they become so exponentiallybetter than they were.>> Allen's story is identical to the onesJeff Hirs has been hearing from his
customers, too.>> They say, "Well, [music] I don'tunderstand this. Last year this was onlya $50 memory card. It now it's over
$100.Why?
>> Jeff is the president of Photo Care, acamera store in New York established in1968. [music] He says prices for memory
cards and solid state drives havedoubled since the beginning of 2026.>> Solid state drive became a standard and
it's actually [music] small now, 1 TBTE.So this right now is over $300 and 8months ago before the turn of the year
it was maybe [music] $170. One customerthat was shooting a movie bought cardsthat were effectively say $500 a card
last year or the last time [music] thatperson bought more cards uh they were$1,300 a card. He says the high prices
for memory have put financial pressureon his clients who depend on them forwork.>> It's just a tough spot right now for
[music] people that are using electronicameras in making their their living.We've seen [music]our media sales numbers as far as
quantity decrease by30%.>> Jeff worries recent price hikes couldhave broader implications for theindustry. I don't want to say [music]
it's putting electronic media out ofreach of some people, but it is comingclose to that.So, is there any relief in sight?
Possibly. One solution is to open morechip factories known as fabs to increasesupply. But opening a fab is not cheap.
The cost of building one is estimatedbetween $15 billion and$20 billion. Themajority of that cost comes from the
xpensive machines needed to make thesechips. Just one cost up to $400 million,and a single facility needs rows and
rows of them. Keeping FABs clean is alsovery expensive. Many requirespecifically designed clean rooms to
protect sensitive silicon wafers fromdust and other airborne particles thatcould cause microscopic defects. And
even if the cost of construction weren'tan issue, it would still take 3 to 5years to build a single fab.>> You can't just flick a switch and say we
're going to double the amount ofmemory chip production [music] in 6months.>> SK Heinix told Business Insider that
it's fasttracking the construction ofFABS with the Yongen semiconductorcluster, which was scheduled for
completion in 2045, but has been movedup to 2023. Some critics believe thememory shortage may be manufactured. In
June 2026, 17 plaintiffs filed a classaction antirust [music] lawsuit allegingthat Micron, Samsung, and SKH Highix
worked together to limit memory supplyand drive up prices. This is not thefirst time these companies have been in
hot water. In the early 2000s, Samsungand Heinix pleaded guilty to conspiring[music] to fix jam prices. Micron
admitted to participating in the sameconspiracy, but escaped prosecution bycooperating with federal investigators.
>> When that type of demand hits anindustry like this, there's a lot lessleeway and there's really a lot more
control that these three or fourcompanies exert over the industry.Sometimes that's okay, but sometimesit's really really damaging and it'll be
[music] up to the people involved inthis lawsuit to to prove those damagesbeyond beyond a reasonable doubt.
Another solution would be slowing thexpansion of AI data centers to helpchip production catch up. And that push
is growing. Data centers have facedgrowing backlash from communities acrossthe US for their long-term effects on
both the environment and the economy. IfAI data center construction slows byhalf or it takes twice as long to
develop these things or or if fewer ofthem [music] actually get done oractually get approved, then you could
really have a change in in AIdemand for memory chips for sure.>> On July 18th, 2026,142 protests opposing data center
buildouts took place across 42 states.So far, dozens of local governmentsacross the US have [music] moved to
pause data center construction. In July2026, New York became the [music] firstate to enact a one-year moratorum.
>> This pause will remain in place for upto one year, while New York establishesthe strongest possible framework to
protect our communities. If politics andthings like permitting and things likethat, if those types of issues slow down
AI development, you could certainly seea knock-on effect on demand for memorychips and storage. The only question
left is whether in the age of AI, memory[music] prices will ever go down. Ifwhat's past is prologue, Alistair says
history might give us a clue.>> Go back two or three decades, the memorychip industry was hugely cyclical. So
there'd be these huge boom periods wheredemand would go up and there wasn'tenough supply and prices would really
rise and [music] memory chip makerswould make massive amounts of money andthen demand would slow down a bit.
Production would increase and there'd beover supply and then prices would crashback down. That type of long-term
history of boom and bust cycles is veryhard to break. We might just makeway too many memory chips in two years
time and then prices will come crashingdown again. I've been doing this for 20or 30 years now and and a lot of things
that people thought would last foreverhaven't lasted forever. So, I think Ithink that's certainly going to be true
again.