The AI price shock is here: Apple, Microsoft hike prices
Summary
Apple and Microsoft have raised prices on their devices because AI technology is increasing the cost of key parts like memory chips. This price rise affects not only computers and tablets but also gaming consoles, as companies face higher costs they cannot absorb.Key Facts
- Apple increased prices by up to 25% on MacBook and iPad models due to higher memory chip costs linked to AI demand.
- Microsoft raised Xbox console prices by up to $150 for the same reason.
- Storage and memory costs have more than doubled since last fall.
- Gaming consoles are often sold at a loss or very low profit, so higher component costs lead directly to price hikes.
- The AI boom is driving up demand for resources like electricity, water, and data center space.
- Consumer electronics prices, which usually fall over time, are now rising because of AI-related cost increases.
- Computer software and accessories prices jumped a record 14.5% in May compared to last year.
- AI’s effect on jobs is still uncertain, but its impact on product prices is already visible to consumers.
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