Memory chipmakers are gaining pricing leverage as Apple, Nvidia and Qualcomm compete for memory supply during the AI boom.

The AI boom is reshaping the memory market, giving chipmakers greater pricing power and leaving brands like Apple with less leverage.

Before the AI boom, technology conglomerates had significant influence over memory prices, but the surge in demand for AI infrastructure has changed the landscape. Recent reports suggest that the sudden rise in demand for memory chips has weakened Apple's bargaining power with memory suppliers.

Reports suggest that in its heyday, Apple would insist on extensive financial audits and use other tactics to secure rock-bottom prices. However, that leverage has now diminished as market dynamics have changed significantly.

In the past, Apple raised the prices of products in its lineup, saying it could not absorb the rising costs of memory chips on its own and had to pass some of the burden on to users.

A Wall Street Journal report notes that Apple had firsthand knowledge of its suppliers' internal business operations and factory output. It also knew how financially dependent a supplier was on securing a major order. Apple used this leverage to win a major arbitration case against Micron over the latter selling NAND storage at a lower price to another customer. Reportedly, Apple would sometimes refuse to accept deliveries of storage chips if broader NAND prices began to fall, leaving suppliers with unsold inventory of chips custom-made specifically for Apple.

Apple has also been accused of relentlessly auditing its suppliers' books, even negotiating a discount with Deloitte because of the sheer volume of audits it commissioned.

With the market changing, Apple now finds itself on the other side of the equation. Memory buyers such as Nvidia, AMD and Qualcomm can outbid it to secure substantial volumes of advanced memory, including LPDDR5X and SOCAMM2. Apple must now compete with other major buyers while ensuring it maintains its competitive edge, leaving it with less bargaining power than before.

**Rising memory prices**

As AI companies such as OpenAI, Anthropic, Google and Meta compete for computing power to run their massive data centres, the world's biggest memory makers, Samsung, SK Hynix and Micron, are benefiting from the surge in demand. These companies are shifting resources away from consumer-focused products and towards supplying AI companies.

Severe shortages of RAM and other memory products are contributing to price hikes for RAM kits used by PC builders, as well as for a range of devices, including laptops, smartphones and gaming consoles. Some companies, such as Raspberry Pi and Framework, have already raised prices, while Dell, Asus, Acer, Xiaomi and Nothing have warned of possible price hikes.

The RAM and memory shortage could continue into next year, according to analysts at International Data Corporation (IDC).