According to the market research firm NPD, the biggest models of televisions saw their prices increase by 30% compared to last year. The surge is directly proportional to the current semiconductor crisis, and it’s only a matter of time that this jump will be seen on other devices with similar circuitry – laptops, tablets and VR devices.
Prices are probably going up for most products
Some OEMs have already indicated a potential price hike. Taiwanese PC maker ASUS has hinted that the chip shortage will mean “more upstream price hikes,” which will affect buyers.
As the chip supply shortage has hampered the semiconductor industry, another challenge awaits devices with integrated circuits bound to the display, which are generations behind the latest manufacturing processes. With the major chip makers focusing heavily on increasing the production of advanced chips, little investment is made in older facilities. When the demand arises for these circuits, it will be impossible to meet the demand.
All types of devices have encountered production problems due to the lack of semiconductors. Sony has already confirmed that the PlayStation 5 will face a shortage until 2022 due to a chip cracking.
What caused the shortage?
Many factors have combined to reinforce this dryness of semiconductors. The pandemic has driven up demand for home electronics, and the economic downturn has caused demand to fail in many industries.
According to IDC, computer systems are the main drivers of semiconductor demand, followed closely by smartphones. The shortage was also felt beyond the supply of consumer products. Many automakers have had to halt production and cancel pre-orders due to the shortage. Apple and Samsung have also felt the pressure due to a lack of components. Geopolitical friction between China and the United States is also seen as a reason behind the problem.
Rarity could last for years
Well, the scarcity could last “a few years,” IBM president Jim Whitehurst confirmed at a BBC interview. His quote matches claims by Intel and Nvidia, whose supply chains have been hit hard due to the pandemic.
IBM recently ditched the world’s first 2nm chip, setting a new standard for chipmakers. While the incorporation of the latest chip may be a long way off, Whitehurst suggests that the semiconductor industry must find ways to extend the lifespan of computer technologies to tackle chip shortages in the future.