Why Your Next Smartphone Will Cost More: Carl Pei Blames the "AI Memory Crunch"

Phones are getting more expensive in 2026. 📈💸 Carl Pei explains why the 'AI memory crunch' is forcing price hikes. Here’s the reality check 👇 

Get ready for your wallet to take a hit. If you are planning to buy a new smartphone in 2026, you might want to start saving up a little extra. Nothing’s CEO, Carl Pei, has officially confirmed what many of us have feared: phone prices are going up, and it’s not just greed—it’s an industry-wide supply chain crisis.

In a candid post on X (formerly Twitter), Pei explained exactly why your next Nothing device—and likely phones from other brands—is going to cost significantly more.

https://t.co/ynfCSXu0Yh

— Carl Pei (@getpeid) January 14, 2026

The Hidden Cost of the AI Boom

The culprit isn't titanium frames or better cameras; it’s memory.

As Pei explains, the entire tech industry is currently fighting a fierce battle for NAND and DRAM chips. Why? Because the explosion of Artificial Intelligence requires massive data centers. These data centers are swallowing up huge volumes of memory components to train AI models, leaving fewer supplies for smartphone manufacturers.

When supply drops and demand hits the roof, prices skyrocket. Pei notes that this puts "pressure on manufacturers' margins," leaving brands with two stark choices: either degrade the phone's specs to keep the price low, or pass the cost on to the consumer.

Pei is choosing the latter. "Prices of Nothing smartphones launching in Q1 2026 will witness an inevitable increase," he stated.

The Specs Race Is Over (But Performance Is Up)

While the price hike is disappointing, there is a silver lining. Pei suggests that the era of the "mindless specs race" is ending. Instead of chasing raw numbers on a sheet, Nothing wants to focus on what actually matters: user experience.

To back this up, the upcoming mid-range Nothing phones are getting a serious internal upgrade. The company is shifting from UFS 2.2 storage (found in the Nothing Phone 3a and CMF Phone 2 Pro) to UFS 3.1.

This isn't just alphabet soup. UFS 3.1 is significantly faster. It means your apps will launch quicker, file transfers will be snappier, and the overall system will feel more responsive. You are paying more, but you are getting a genuinely better engine under the hood.

It’s Not Just Nothing

Pei isn't crying wolf. This is a trend that major players are warning about. Just recently at CES 2026, Samsung's President and CMO, Won-Jin Lee, hinted at repricing devices due to the worsening memory shortage.

Similarly, Francis Wong, CMO of Realme India, told Gadgets 360 that price hikes in 2026 are "unstoppable" and will likely continue through late 2027.

What This Means for You

If you were hoping for a budget flagship in Q1 2026, you might be out of luck. Whether it's a Nothing phone or a Samsung, the days of cheap high-end storage seem to be on pause. But for those willing to pay the premium, the shift to UFS 3.1 and a focus on actual user experience might just make that higher price tag worth it.

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