The depressing future of cheap mobile phones, in two graphs that are a death sentence for the low-end

Quick, make a wish. The motive behind these lines is more difficult to see today than a four-leaf clover: the Realme C71 (which we tested less than a year ago) came on the market with 8GB of RAM, 256GB of storage and a RRP of 149 euros. A species in extinction, something impossible in 2026. We are facing a paradigm shift in the mobile industry.

In recent years we have seen how manufacturers benefited from an excess supply of memories that made it possible to build combinations of RAM and storage at ridiculous prices. That era is over: a recent report from Counterpoint Research confirms that the cost of components is suffering its greatest pressure in a decade and the outlook is bleak: either brands sacrifice their profits or pass the cost on to the consumer. Or both and an extra: the entry range is disappearing in every sense.

What has happened to the price of NAND and DRAM. The price increase in the first quarter of 2026 has been abysmal and without close precedents:

• RAM memory (DRAM) has suffered a quarterly increase of more than 50%.
• NAND Flash has seen an even more aggressive rise, exceeding 90% compared to the previous quarter

As a picture says a thousand words, the graph prepared by Counterpoint Research:

Source: Counterpoint Research Price Tracker

Why is it important. This phenomenon is not a simple fluctuation or a temporary shortage, it is a structural change that puts the economic viability of many manufacturers in check. DRAM (speed and multitasking) and NAND (storage capacity) are essential in the user experience. Until now, scaling these memories was cheap, but not anymore. In the entry range, the cost of memory already represents almost half of the manufacturing “ticket”, sometimes exceeding the cost of the processor or the screen itself.

With current profit margins, absorbing this impact is impossible: either the price is raised, or it is sold at a loss. The market has already revised downwards global shipment forecasts for 2026: Counterpoint estimates a drop of 2.1%, while IDC is more pessimistic and projects a decline of 12.9%, which would exceed the 12% contraction recorded in 2022.

Context. The culprit has its own name: generative artificial intelligence. More specifically, the explosion of artificial intelligence infrastructure. The data centers that power AI models are demanding memory on a large scale, thus becoming direct competition with mobile manufacturers for the production of Samsung, SK Hynix and Micron. Capacity is finite and AI takes priority for reasons of profitability. If we also take into account that the latest generation processors manufactured in 2nm they have become more expensivewe have the perfect storm.

Retail. The increase in the price of memory does not affect all mobile phones equally. This is how the weight of memory is distributed in the total cost of the device:

• The entry range ($200 or less) is the most affected. With a typical configuration of 6 GB + 128 GB, memories already represent 43% of the total cost of the device. An increase of 30 dollars per unit is estimated.
• In the mid-range (400-600 dollars) the combination goes from 25 to 36%, which can mean 60 to 80 dollars per unit.
• In the premium range (over 800 dollars), the increase is more diffuse and they are also exposed to double pressure, that of the most expensive memories and that of the processors, which translates into increases of between 100 and 150 dollars that we will begin to see reflected in the launches of the second half of the year.

How will the user notice it?. Counterpoint has estimated these price increases between $30 and $150 depending on the range, but the cushioning is not always going to be so obvious and direct. In the entry range, where the margins are so small, another way out is to cut the catalog to a minimum.

We will see manufacturers “killing” the base model to force the jump to the next price step, much smaller catalogs and, above all, technical stagnation. The old 128GB will return as standard and, in the worst case, we will see steps backwards with the use of slower and older memories (LPDDR4X) to try to save the furniture in the mid-range.

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Cover | Xataka, Pepu Ricca