Smaller phone and laptop makers brace for years of memory scarcity

The memory chip market has split into two worlds. In one, major producers are funneling capacity into lucrative high-bandwidth memory for AI data centers. In the other, smaller phone and laptop manufacturers are fighting over the scraps, facing a shortage that industry executives say could persist well into 2028.

Companies like Fairphone, Framework, and Jolla, brands that built loyal followings on repairability and openness, are now grappling with a crisis that has nothing to do with product design and everything to do with allocation. The problem isn’t just that memory costs more. It’s that they can’t reliably get it at all.

The AI vacuum

The root cause is straightforward. Samsung, SK Hynix, and Micron, the three companies that dominate global memory production, have redirected manufacturing resources toward high-bandwidth memory (HBM) chips used in AI data centers. Those chips carry significantly higher margins than the conventional DRAM and NAND that go into entry-level smartphones and personal computers.

For smaller electronics brands, memory can account for up to 60% of manufacturing costs.

TrendForce projects conventional DRAM contract prices will climb 13-18% in the current quarter. That follows an extraordinary increase of 93-98% in the first quarter of 2026. To put that in context, memory prices nearly doubled in a single quarter earlier this year, and they’re still going up.

SK Hynix’s CEO has gone further, predicting 2027 will be “the worst year in the industry’s history” for supply, with demand expected to exceed available capacity beyond 2030.

No seat at the negotiation table

What separates Apple and Samsung from Fairphone and Framework isn’t just scale. It’s contractual leverage. Major manufacturers lock in multi-year supply agreements that guarantee allocation at fixed or negotiated prices. Smaller players don’t have that luxury.

Framework’s CEO noted that larger manufacturers’ supply advantages have diminished somewhat, following an urgent scramble to secure inventory late last year.

Jolla reported that its DRAM and storage combination package prices peaked in March and have since stabilized. The catch: normalization of supply isn’t expected before 2028.

Counterfeiting has emerged as an additional headache. With legitimate supply constrained, the gray market for memory chips has expanded, forcing smaller manufacturers to invest more heavily in chip authentication and quality control.

Adapting to survive

The shortage is forcing tangible changes in how these companies build and sell products. Several strategies have emerged.

First, prioritizing complete systems over standalone components. Framework, known for selling individual upgrade modules, may find it more economical to allocate scarce memory to full laptop builds rather than offering components piecemeal.

Second, monetized upgrades. Some manufacturers are introducing paid upgrade tiers that help offset the higher input costs.

Third, spec revisions. Lower-margin products may ship with less memory or slower storage than originally planned.

The broader market picture

Counterpoint Research projected in June 2026 a 13.9% drop in global smartphone shipments for the year, reaching an estimated 1.08 billion units. That would mark the sharpest annual decline on record.

Falling demand and rising component costs is a brutal combination. In a healthy market, declining shipments would push component prices down as suppliers compete for orders. Instead, the reallocation toward AI memory has decoupled supply from traditional demand signals. Fewer phones are being sold, but the chips inside them are harder to source and more expensive than ever.