00:02Singapore's Sim Lim Square is a six-storey maze of computers, components and cell phones as well as electronics repair
00:10shops.
00:11In recent weeks, an unprecedented surge in the price of RAM chips is complicating business for many of the repairmen
00:19here.
00:19Some of the customers may consider to postpone the upgrading.
00:25The prices keep changing, so we cannot estimate anything.
00:30RAM, or random access memory, is used in almost every smart device.
00:36It's the short-term memory that lets your computer or handphone access data and apps.
00:41In the past few months, prices have skyrocketed, in some cases by as much as 500%, depending on the type
00:48of chip.
00:50The reason? Soaring demand for them to support the expansion of artificial intelligence.
00:55An AI gold rush is diverting manufacturers away from standard consumer chips towards high-end AI chips because of better
01:03profit margins.
01:04That supply squeeze is pushing prices even higher.
01:08It's not just the cost that's impacting business for repairmen like Yap Chin Huat.
01:13It's also the extreme volatility.
01:16The price of replacing chips can shift within a matter of minutes.
01:20Once we confirm, then we have to quickly get it fixed at this price.
01:25We try to lock the price and get the thing done.
01:27If the customer comes back two hours later, then we will call him again two hours later.
01:32Tanvir Ahmad is a memory chip trader at Simlim Square.
01:35He says in the past two months, as customers shun cost increases, he's lost about half of his regular business.
01:43To manage the situation, he's cutting back on inventory.
01:46We are thinking that, OK, let's hold it. Don't buy the lot of stock. Just make maybe three or four
01:55few models.
01:57And just don't keep stock so much because we do not know, suddenly maybe it can go down as well.
02:04Ahmad's also avoided stocking the newest generation DDR5 chips.
02:10He's worried he'll be stuck with them if people refuse to pay the higher prices.
02:15In October, a 64 gigabyte kit retailed at around $200.
02:21Now they're selling for more than a thousand.
02:24The spike is also hindering efforts to expand Singapore's AI workforce.
02:28Here in Singapore, government is encouraging to people to learn AI and they are subsidizing the courses as well.
02:38So when the people going to learn and take these classes, they need the computers.
02:44And those computers, especially the laptops, they need at least minimum one terabyte of SSD and minimum 32 GB of
02:52RAM.
02:53Many businesses and individuals are holding off or opting for less advanced upgrades.
02:58And the ripple effects extend beyond repair shops.
03:02Tech research firm IDC calls it a memory crisis and predicts the worldwide PC market will decline by 11.3
03:09% this year.
03:11The smartphone market could shrink by 12.9%.
03:15There's supply limits that are limiting this market, but there's also elasticity issues.
03:21From a demand perspective as well too, you know, inevitably as these price increases happen,
03:26the phone and smartphone vendors have to raise their prices to basically pass some of it on.
03:32To the degree that they can absorb the margins, they can.
03:34But the reality is the prices are going up too much that they can't absorb that in the margin.
03:38So they have to pass on those prices to consumers.
03:40As the AI race reshapes the chip industry, everyday devices could become the hidden cost of tomorrow's computing power.
03:48että
03:48You
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