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ZDNET’s key takeaways

• RAM prices are soaring due to AI demand, driving up Pi costs.
• Two Raspberry Pi boards can now cost as much as a laptop.
• AI data centers are fuelling RAM shortages, impacting consumers.

It’s no exaggeration to say that RAM prices are skyrocketing, driving up the cost of products that rely heavily on memory. One product category that’s been hit particularly hard is the Raspberry Pi single-board computer. 

Once celebrated as a low-cost solution for hobbyists, the price of Raspberry Pi boards has now soared to the point where two 16GB Raspberry Pi 5 boards will cost you as much as a new MacBook Neo.

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So, what’s going on with RAM prices?

What’s causing the RAM price surge?

Most industry experts blame AI data centers as the main culprit. G.Skill, a well-known RAM manufacturer, issued a statement last year explicitly citing “unprecedented high demand from the AI industry.”

After all, we all want the ability to enjoy videos of a giant cat fighting Godzilla, right?

At first, we saw massive price hikes for the newer DDR5 RAM, but as manufacturers and consumers decided to stick with DDR4, the price of that also went stratospheric.

The demand from AI data centers has grown so significantly that Micron, one of the largest memory manufacturers, decided to shutter its Crucial consumer business and focus entirely on supplying memory to data centers.

Why is AI driving this demand?

The answer is simple: data centers consume massive amounts of RAM, far beyond what consumer devices require. PC maker Framework highlighted this disparity in a blog post last month:

“A single rack of NVIDIA’s GB300 solution uses 20TB of HBM3E and 17TB of LPDDR5X. That’s enough LPDDR5X for a thousand laptops, and an AI-focused data center is loaded with thousands of these racks!”

Put simply, the companies building these data centers have deep pockets and vast amounts of investment capital, leaving everyday consumers — like those buying laptops for work or school — unable to compete for affordable RAM.

Staggering price increases

The price hikes are jaw-dropping. 

Eben Upton, founder and CEO of Raspberry Pi, recently addressed the issue in a blog post. According to Upton, the price of LPDDR4 DRAM — the type of RAM used in the Raspberry Pi 4 and 5 — has risen sevenfold over the past year, and this has necessitated a price bump. These price hikes translate to an additional $25 for every 4GB of RAM required by a Raspberry Pi board.

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Here’s how this plays out:

For context, a 16GB Raspberry Pi 5 now costs $305. Compare that to launch pricing, when the same board was just $120. Even at that price, I thought it was expensive. Now? It’s reached an absurd level.

This isn’t just a Raspberry Pi problem

As AI data centers continue to expand, the scarcity — and astronomical cost — of essential components like RAM are likely to persist. This creates a ripple effect that raises the prices of everyday devices, from your smartphone to your smartwatch… even your car.

So, what can you do?

You want to pick up a Raspberry Pi but don’t want to spend hundreds?

Here’s what you can do:

1. Shop around: Some retailers haven’t yet raised their prices significantly (though this changes hourly). I won’t link to anything here because these deals are fleeting, but it’s worth checking multiple sources.
2. eBay deals: If you only need a few Raspberry Pi units, check out eBay. I’ve bought both new and secondhand boards from eBay for projects and always managed to find good deals. Only recently, I sourced a dozen boards that were either brand new or close to new for a fraction of what they would have cost retail.
3. Budget options: Not all Raspberry Pi models have seen massive price increases. You can still pick up 1GB/2GB variants of Raspberry Pi 4/5 in that $35 to $65 region, and the 4GB Raspberry Pi 400 is still only $60. Most Pi projects don’t need as much RAM as people think, and these smaller boards are perfectly capable of handling everyday tasks.
4. The new 3GB Pi: If you need just a bit more RAM, the Raspberry Pi Foundation has released a 3GB Pi 4 for $83.75.
5. Older models: Older Raspberry Pi products that use LPDDR2 DRAM — like the Raspberry Pi Zero, Zero W, and Zero 2 W; Raspberry Pi 1, 3, 3B+, and 3A+; and Compute Module 1 and 3+ — are unaffected by these price increases. Honestly, it amazes me how many people spend big bucks on a Pi 5 when a $15 Zero 2 W will do the job for many projects.

What about alternatives?

These RAM price increases aren’t limited to the Raspberry Pi. They’re affecting everything. However, alternative boards like the Orange Pi Zero LTS or the Radxa X4 might suit your needs. Depending on your project, these could even outperform the Raspberry Pi.

Are RAM prices going to drop anytime soon?

Let me grab my crystal ball and take a lo… oh wait, I don’t have one.

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The good news is that RAM prices have dipped slightly from their peak earlier this year, but not by much. There’s even talk of price crashes, but I think that’s mostly wishful thinking.

The general feeling in the industry is that RAM prices will remain high until at least 2028. Why? Because the market is dominated by just three companies — Samsung, SK Hynix, and Micron — which control around 95% of global DRAM production. Building new RAM fabrication plants is slow and expensive, taking 2 to 4 years to build and costing about $10 billion (give or take a couple billion).

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Add to that the constant pressure from hardware manufacturers to always be lowering prices, and there’s little incentive for RAM makers to increase production for consumers.

The TL;DR

RAM prices are high, and they’re likely to stay that way for the foreseeable future. AI is driving unprecedented demand, and manufacturers are prioritizing high-margin customers like data centers over everyday consumers. Hobbyists and tech enthusiasts will need to either adjust their expectations or get creative with alternatives.

Also: The best Raspberry Pi alternatives: Expert recommended

For now, grab a deal where you can, consider older or less RAM-heavy boards, and keep an eye out for any breakthroughs in the market.