Ask Paul: December 19 ⭐

Happy Friday! And where did this month go? While we sort that one out, let’s kick off the weekend a bit early with one of the longer Ask Pauls in recent memory.
? The enshittification of the supply chain
Leo_W asks:

Micron Crucial is getting out of the consumer space to focus on delivering only to AI data centers. Other suppliers may follow. The warnings I'm hearing from vendors is we're on the verge of a supply chain issue that could be bigger than experienced during the pandemic. Prices for the next six months to a year could double on some components. This would affect desktop, server, and mobile devices. What have you heard from your contacts in the industry?

I don’t have any contacts on this side of the industry, but I do know several people at PC and device makers, and the reactions I’ve seen vary between ambivalence and vague worrying. With the insane tariffs that hobbled them in the first half of the year, especially, and these new component shortages, I think we’re in for a dark era of higher prices and longer wait times. This is the opposite of what we’ve been trained to accept from Amazon, especially, but also whatever other instant gratification-type services (DoorDash, etc.)

Looking at this from a PC-centric place, as I often do, I’m not sure the changes are all that dramatic for most consumers. No one “normal” is building or upgrading PCs or related devices like NASes anyway, and that has long been a sort of niche use case anyway. We had two-ish years of GPU shortages thanks to AI, and now we’ve moved onto RAM, and we’ll see where/if it ends. But those who are doing this sort of thing will find it a lot more expensive, at least for now.

One rumor I saw is borderline troubling but might have a silver lining: Again, thanks to AI, phone makers have been expanding the amount of RAM in phones over the past few years, and we’re finally at the point where any flagship or mid-level phone will ship with what I think of as a reasonable amount of RAM for this era (12+ GB). But because of the rise in component prices, it’s possible we’ll see that reverse, with phone makers going back to lower amounts of RAM or least freezing the RAM size increases.

If true, this may force that “life will find a way” moment, similar to what we saw earlier this past year with DeepSeek, where companies pushing AI will do so in more efficient ways. And so maybe we do more with less, so to speak.

This is bad timing, not that there’s ever a good time for these sorts of issues. Phone makers and Microsoft/PC makers have been pushing on-device AI for years and that requires much more powerful chips and more RAM. You could make an argument, vaguely, that even a 20 percent price hike on a phone can make financial sense vs. paying for the cloud infrastructure for AI over whatever number of years that you own the device. But almost no one thinks that way, and one of the appeals of a subscription service is that it spreads out the payments over time...