Qualcomm, a manufacturer of smartphone application processors (APs), is expected to raise prices by more than 10%. Observers say increases in the costs of smartphones and various body-worn wearable devices will be unavoidable.
Bloomberg reported on the 25th (local time) that it had obtained a copy of a letter sent to Qualcomm's customers the previous day, saying Qualcomm plans to raise prices on products shipped after September 1 this year by double-digit percentages. In the document, Qualcomm said that as prices of mobile chip components surged due to explosive demand for artificial intelligence (AI) development, it had responded by seeking alternative suppliers, but is no longer able to withstand rising costs.
The AI development boom has left the smartphone market struggling. As foundry (contract semiconductor manufacturing) companies such as TSMC operate their facilities primarily for data center chips, mobile chips have been pushed to the back burner. With memory also being supplied mainly for AI servers, mobile manufacturers are experiencing a severe memory supply shortage.
Observers say that if Qualcomm significantly raises chip prices, smartphone price increases will be inevitable. This is because Qualcomm chips are installed in most top-tier (flagship) models using the Android operating system (OS). Apple, which installs its own chips in iPhones, is also expected to raise prices from September due to rising costs, according to observers. Qualcomm chips are also used in smart glasses. IT outlet The Verge predicted that "Qualcomm's price increases are especially likely to have ripple effects on the smartphone market."
