south african consumer Technology prices enjoyed a rare bout of decline in early 2026 – but the relief is already ending as the global memory shortage has sent the cost of phones, laptops and other devices soaring again.
Data from NielsenIQ (NIQ) shows that unit sales of technology and durable goods outpaced sales price growth in the first quarter as average selling prices declined, making affordability the most important factor in consumers' purchase decisions. Shoppers bought more but spent less, trading up to cheaper models in almost every category.
The biggest weakness was telecommunications, which NIQ uses to track the smartphone market. Unit sales declined 7.5% in the quarter and selling prices declined 3.1%, led by declines in the broader technology and sustainable markets. NIQ said post-paid customers kept their handsets longer in the absence of attractive new features and average prices continued to fall as buyers gravitated towards prepaid and mid-tier devices.
running out
Meanwhile, sales of laptops, monitors and routers boosted unit sales by 5.8%, but falling prices drove total value down 9.4%. The volume of panel televisions increased by 8.8%, while their value decreased by 2.4%. Only major home appliances increased in both volume and value, helped by lower prices for freezers and washing machines.
However, that era of cheap technology is coming to an end. NIQ warned that memory and storage shortages are already driving up prices of phones, laptops and other devices, and rising component costs will make it harder for retailers to stimulate demand through price cuts alone. NIQ South Africa MD Zak Heery said the pressures, along with renewed fuel-driven inflation, would “put real pressure on household budgets” for the rest of the year.
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The culprit behind this is the AI boom. The world's three big memory makers — Samsung, SK Hynix and Micron, which control more than 95% of the market — are turning production toward higher-bandwidth memory used in AI data centers, where margins are far richer. This has decimated the market for traditional DRAM and NAND flash that goes into consumer phones and computers, driving up prices.
- Counterpoint Research estimates that mobile DRAM prices have increased by about 70% since the beginning of 2025, while NAND flash storage has almost doubled.
- Research firm TrendForce says smartphone and notebook brands are being forced to raise prices and even cut specifications, with some entry-level phones reverting to 4GB of memory.
- IDC expects DRAM and NAND supplies to grow well below historical norms this year, and estimates global smartphone average selling prices could rise between 3% and 8%, with the cheapest handsets – those under US$100 – at risk of disappearing entirely. PC manufacturers have warned of a 15-20% increase in prices.
For a price-sensitive market like South Africa, where NIQ data showed consumers were already postponing upgrades and trading down, the timing is bad. The brief period in which falling appliance prices had provided relief to cash-strapped households is coming to an end just as fuel costs have fueled inflation again – consumer inflation reached 4% in April, the highest since August 2024.
Entry-level and mid-tier devices, precisely the segment that South African buyers are retreating into, are most at risk of memory-driven price increases. – © 2026 NewsCentral Media