Just two weeks into 2026 and it already looks as though obtaining the best phones of the year might cost you a packet.
That's what Nothing Phone's founder, Carl Pei, has to say. Taking to LinkedIn, the CEO says that "2026 will be an unprecedented year".
Not only for Nothing products, mind, but for the whole smartphone category and, in some caes, the wider consumer electronics market. So just why is this happening and what can we expect in the coming months?
It's down to a single assumption that, until now, has generally played out: that mobile "components would inevitably get cheaper," says Pei. "In 2026, that model has finally broken."
It's down to supply and demand. The materials required for manufacturing continued to be obtained, but their destination is now broader.
"AI [artificial intelligence] has fundamentally reshaped demand," continues Pei. "The same memory used in smartphones is now critical for AI data centers [sic] ... For the first time, smartphones are competing directly with AI infrastructure...
"In some cases, memory costs have already increased by up to 3x, with further rises expected... Memory modules which cost less than $20 a year ago could exceed $100 by year-end for top-tier models."
And who will have to foot that bill? There are ways to manage it, but top-tier flagships are simply going to cost more owed to component sourcing for this year – and it might only get worse.
The other solution? "Brands now face a simple choice: raise prices by 30% or more in some cases, or downgrade specs," says Pei, declaring that the "more specs for less money" model is over.
This might be a greater issue at the entry-level of the market, where lowest possible pricing is the greatest appeal. In the mid-to-upper segment there's more wiggle room.
But you can probably assume that higher RAM and SSD configurations will be absent from many makers' line-ups in 2026 as a result, from Nothing to Samsung, Apple to Google, as AI eats up the supply.
It's a Catch-22 scenario, however, as mobile makers' biggest differentiating features of recent years – aside from design language, which is Nothing's Phone 3 point of distinction – have often relied on advancing AI.
From Nothing's Essential Space to Samsung Galaxy AI and Google's Pixel computational photography features – it's all AI-dependent, serving a drive for this very mobile market.
One feeds the other and so, here we are folks, in a spiral of increasing costs. Hopefully brands will also conserve, create fewer product ranges, focusing on the core flagship, mid-tier and entry-level models that truly matter – delivering the best for us all.
But if you're looking to upgrade in 2026 then, well, the writing's on the wall: the best Android phones are simply going to cost more. And it's in large part because of that love-hate relationship with AI...
