Gartner: Soaring Memory Costs to End Entry-Level PCs by 2028
▼ Summary
– DRAM shortages are causing severe disruptions in the PC industry, leading to soaring hardware prices, delayed product launches, and rapidly dropping inventory.
– PC manufacturers are forced to pass rising memory costs to consumers, making it impossible to sustain budget-friendly, entry-level PCs, especially in the $500-$1,000 range.
– Gartner predicts the sub-$500 entry-level PC segment will disappear by 2028 and that overall PC shipments will drop by 10.4% in 2026.
– Consumers are expected to delay PC purchases, increasing the average PC lifetime by 20% this year, while manufacturers will accept lower sales volumes to maintain profitability.
– The memory price inflation will hit most aggressively in Q2 of this year, and the only viable solution for budget gamers is to postpone purchases until shortages ease, which may take over a year.
The landscape of personal computing is facing a fundamental shift, as soaring memory costs threaten to eliminate the entire market for entry-level PCs within the next few years. According to a new industry analysis, manufacturers are being forced into a corner, with no viable path to continue offering hardware at traditional budget prices. The core issue is a severe shortage of DRAM, a critical memory component, which has driven production costs to unprecedented levels. This supply crisis is causing hardware prices to climb, delaying product launches, and rapidly depleting retail inventories. The report forecasts a significant 10.4% drop in PC shipments by 2026, a steeper decline than expected for smartphones, effectively rendering the concept of a ‘budget build’ obsolete.
The sub-$500 entry-level PC segment will disappear by 2028, states a senior director analyst at the firm. For manufacturers, the math has become unsustainable. Memory costs now represent a sharply increased portion of a product’s total bill of materials. In the past, companies might have absorbed these incremental costs on lower-margin devices to maintain consumer interest, but the current market pressure is too intense. They are now essentially compelled to pass these expenses directly to the customer. This cost transfer is predicted to hit the mid-range market hardest, making PCs in the $500 to $1,000 range the most vulnerable to significant price increases.
Consequently, consumer behavior is expected to change dramatically. The analysis suggests that holding off on new PC purchases will become a more attractive option for many, leading to an estimated 20% increase in the average PC lifespan by the end of this year. From a business perspective, manufacturers are left with few good choices. To maintain profitability in this challenging environment, they will likely have to accept a decline in the number of units sold. This strategic shift will inevitably affect retail availability, making it harder for consumers to find the products they want. The situation is poised to become even more acute in the coming months, as existing inventories of DRAM continue to shrink, with the full inflationary impact on memory prices expected to hit aggressively in the second quarter.
For gamers and general users operating on a tight budget, the outlook is particularly difficult. The traditional upgrade path is becoming prohibitively expensive. When evaluating potential responses to these rising prices, the most practical advice for cost-conscious consumers may be patience. The only clear solution is to delay purchases until the memory shortage subsides and market conditions stabilize, a process that industry observers warn could take a year or longer.
(Source: wccftech)
