Consumer Tech

The Cheap Phone Is Disappearing From Europe

Sub-200-euro phones are thinning across Europe and PC makers warn of 15 to 20 percent hikes, as memory makers divert supply to AI data centers.

Consumer TechBy Servola Tech Desk2026-07-063 min read

AI-assisted, edited by humans. | Editor-in-Chief: Leon Soliman | Editorial standards

The Cheap Phone Is Disappearing From Europe

Why the cheapest phones went first

A gigabyte of memory sold as high-bandwidth memory to an AI server earns a manufacturer three to five times what the same silicon earns inside a phone. So Samsung, SK Hynix and Micron have spent 2026 moving wafer capacity toward high-bandwidth memory and away from the ordinary DRAM and NAND that budget devices depend on. High-bandwidth memory now consumes close to a quarter of all DRAM wafer supply.

The result shows up first at the bottom of the market. Omdia analyst Runar Bjorhovde reported that phones under 200 euros fell to just 25 percent of European shipments in the first quarter of 2026, an all-time low, while the average selling price climbed to a record 580 euros, roughly 500 pounds. Average DRAM and NAND prices rose more than 80 percent quarter on quarter. Vendors that once chased volume, Bjorhovde noted, are now chasing value because the cheap components are simply not there.

The bill lands in the second half of 2026

Memory contract prices have climbed in steps all year. TrendForce recorded conventional DRAM contracts rising 90 to 95 percent in the first quarter and 58 to 63 percent in the second. Jefferies expects a further 40 to 50 percent in the third quarter and 30 to 40 percent in the fourth. Because a phone or laptop shipped in the autumn is built from memory bought at those higher prices, the increase reaches the shelf months after the contract is signed.

Personal-computer makers have already told corporate clients what that means. Lenovo, Dell, HP, Acer and ASUS have warned of 15 to 20 percent price rises and mid-contract resets. Omdia expects European smartphone shipments to fall 12 percent across 2026, with most of the drop concentrated in the second half. Analysts do not expect meaningful relief before late 2027.

What a buyer should do about it

For a household or a small business, the usual advice to wait for a better deal is inverted this year. The contract-price curve points up through the fourth quarter, so a laptop or phone bought now is likely cheaper than the same model in November. Fleet buyers refreshing hardware in the second half of 2026 should budget for the higher figure rather than last year's.

The deeper change is not cyclical. The sub-200-euro tier is not merely expensive this quarter; it is being engineered out of the range while memory makers can sell every wafer to a data center. Buyers who rely on that tier, and Europe has more of them than the United States, should expect fewer models and thinner specifications rather than a quick return to 2024 prices.

Frequently asked questions

Why are phone and laptop prices rising in 2026?

The main cause is a memory shortage. Manufacturers earn far more selling high-bandwidth memory to AI data centers than selling ordinary DRAM and NAND for consumer devices, so they have shifted production, leaving less supply and higher prices for phones and laptops.

When will memory prices come back down?

TrendForce and Jefferies expect memory prices to peak in the third and fourth quarters of 2026. Most analysts do not expect meaningful relief before late 2027, because the shift toward AI memory is structural rather than a short seasonal swing.

Should I buy a laptop or phone now or wait?

Given that contract prices are forecast to keep rising through late 2026, waiting is likely to mean paying more, not less. If you need the device this year, buying earlier is the safer bet, and the cheapest models may not be replaced at all.

For a decade the cheapest phone got a little better every year. In 2026 it started getting rarer, because the memory inside it is worth more to a data center than it is to you.

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