AI Boom Could Make Smartphones and Laptops More Expensive, Zoho Founder Warns

The rapid growth of artificial intelligence is changing more than just software. According to Zoho founder and chief scientist Sridhar Vembu, the massive investment in AI infrastructure could also push up the cost of everyday technology such as smartphones and laptops.

Vembu recently warned that growing demand for memory chips, processors, GPUs and other computing hardware is putting additional pressure on the technology supply chain.

Why Could AI Make Devices More Expensive?

Modern AI systems require enormous amounts of computing power. Technology companies are investing heavily in data centres, GPUs, memory and power infrastructure to support increasingly capable AI models.

Some of the components required by AI infrastructure are also important for consumer electronics. Increased demand can therefore put pressure on manufacturers and suppliers.

Vembu argued that this growing competition for hardware could eventually be reflected in the prices consumers pay for smartphones and laptops.

Memory Chips Are Becoming Particularly Important

Memory is one area receiving significant attention as AI workloads continue to expand.

AI data centres require large quantities of high-performance memory, while smartphones, laptops and PCs also depend on memory components. If supply does not increase quickly enough to meet demand, manufacturers can face higher component costs.

Those costs can potentially influence the final price of consumer devices.

Will Every Smartphone and Laptop Become More Expensive?

Not necessarily.

Device prices depend on many factors, including component costs, manufacturing expenses, competition, exchange rates and companies' pricing strategies.

A rise in hardware costs does not automatically mean that every manufacturer will immediately increase retail prices.

However, sustained increases in component costs could make it more difficult for companies to maintain the same prices while offering newer and more powerful hardware.

The AI Investment Boom

Companies around the world are spending enormous amounts on AI infrastructure.

The spending includes data centres, advanced processors, networking equipment, cooling systems and electricity infrastructure.

This investment is helping accelerate AI development, but it is also creating greater demand for the hardware needed to run these systems.

Vembu compared the current AI investment boom with earlier technology investment cycles and suggested that the industry should remain cautious about excessive spending.

What Does This Mean for Consumers?

If hardware costs continue rising, consumers could eventually notice higher prices when upgrading their phones, laptops and other electronics.

Another possibility is that manufacturers keep retail prices similar but offer fewer specifications at the same price.

For buyers, this could make comparing specifications and prices even more important before purchasing a new device.

AI Is Still Driving Major Technology Changes

Despite the concerns about rising hardware costs, AI continues to bring new features to consumer technology.

For example, Meta recently introduced a dedicated Meta AI application for Mac that includes system-wide dictation and the ability to use information visible on the user's screen.

Google's new Pixel 11 series is also putting greater emphasis on AI-powered features, showing how artificial intelligence is becoming a central part of modern smartphones.

What Happens Next?

The effect of AI spending on consumer electronics prices will depend largely on hardware supply, demand and how quickly manufacturers expand production.

For now, Vembu's comments highlight an important side effect of the AI boom: the technology may influence not only the software people use, but also the price of the devices running it.

Consumers looking to upgrade should therefore keep an eye on hardware prices and specifications rather than assuming that newer devices will always offer better value.

Disclaimer: This article is based on publicly reported comments and industry developments. Future changes in smartphone and laptop prices are not guaranteed.