Original URL: http://www.theregister.co.uk/2010/01/12/shortages_pc_prices/

2010: The year PC prices go up

Component shortages means end of cheap PCs - for now

By John Oates

Posted in Hardware, 12th January 2010 12:45 GMT

PC prices have fallen - or at least stayed the same - for many years now, but some analysts believe this year will see them become more expensive.

The reason is increasing prices for components as a result of overly pessimistic manufacturers cutting back production during the downturn. The long lead time for building complex fabs for chips and memory components means the recovery could lead to a jump in prices.

Analysts began predicting higher prices for memory chips late last year.

Although demand is traditionally weakest in the first quarter of the year, if the recovery stays on track we could start to see shortages of DRAM chips in the second half of 2010.

Research from Gartner Group suggests a 23 per cent increase in memory prices will start to hit total PC prices. Flatscreen monitors, hard drives and optical drives are also in short supply, The FT reports.

The problem is made worse by moves from second to third generation DRAM chips.

The upshot could be a price rise of 2.8 per cent this year, the FT reports.

This will no doubt spur construction of new Fabs. But pulling funding together, not to mention constructing a plant, all takes time.

Meaning some manufacturers have time to make hay while the sun shines - before the slew of new plants causes another components glut.®