The era of more for less in consumer electronics has hit a significant roadblock.

While the world watches the meteoric rise of artificial intelligence (AI), a side effect is emerging in the pockets of everyday users: the cost of computing devices, from smartphones to PCs, is surging as AI giants monopolise the global chip supply.

This concern was raised by telecom group, MTN, which claimed that though, it hasn’t seen the effects of a shortage of computing components due to the rapid growth of the AI industry’s demand for chipsets – yet, however, the telco is seeing the prices of computing parts going up significantly, largely because manufacturers prefer making AI chips as they are more profitable.

Speaking during an investor call on the back of MTN’s yearly results for the year to end-December, Chief Technical Officer, Amith Maharaj, said Africa’s largest mobile network operator has not seen “a drastic shortage.”

He said the company orders lead items in advance, which include servers that take between six and eight weeks to arrive.

“Delivery is not an issue. It’s just the price has gone up,” added Maharaj.

Indeed, checks showed that for over a decade, the tech industry thrived on democratising specs, bringing high-end features like massive RAM and lightning-fast storage to budget-friendly devices.

According to the latest data from IDC, that trend is now reversing. The cost structure of a smartphone is heavily dictated by its memory components. For a mid-range device, memory accounts for 15 per cent to 20 per cent of the total bill of materials. With RAM prices surging by as much as 250 per cent recently, manufacturers face a grim choice:

Insights showed that the issue isn’t just a lack of materials; it’s a strategic reallocation. Chip manufacturers are pivoting their production lines toward high-margin AI processors used in massive data centres, leaving standard PC and smartphone components in the lurch.

Maharaj stressed that manufacturers prefer making AI chips as they are more profitable.
This shift has created a global bottleneck. While delivery times for servers and hardware remain stable at six to eight weeks, the “price envelope” has shifted.

Even the humble SIM card hasn’t escaped the inflation, with MTN CEO, Ralph Mupita, confirming that rising costs are forcing even the largest operators to prioritise their spending.

“In the near-term, we’re saying, let’s make the choices within an envelope. There’s an envelope of affordability, and we are asking our teams to make choices within that and prioritise. So, it’s something that we are looking at now.”

Mupita added that this situation is affecting companies worldwide. “It’s not specific to MTN. It’s a global issue now.”

Moody’s 2026 Data Centre Outlook predicted that investment in AI-focused infrastructure will hit $3 trillion over the next five years. This relentless demand for silicon to power the cloud is effectively “straining the global semiconductor supply chain” to its breaking point.

IDC warned that this shortage could persist well into 2027, suggesting that the “smartphone threat of 2026” is only the beginning. For consumers, the message is clear: the high-performance device you bought three years ago might actually cost more to replace today with equivalent specs.