That model has finally broken': Nothing CEO says the era of bargain smartphones is over and that its prices could jump by 30%

Date:
Thu, 15 Jan 2026 10:09:23 +0000

Description:
Nothing's CEO says the 'specs race' is over, as rising memory prices mean 'intentional design' is more important than ever.

FULL STORY ======================================================================Nothing' s CEO has said smartphone prices could rise by 30% or more This is due to rising memory costs, fueled by AI As a result, they argue the 'specs race' is over

2026 could mark the biggest shift yet in the smartphone landscape and not
for good reasons, as prices could dramatically rise, and specs could be downgraded.

This is according to Nothings CEO Carl Pei, who, in a rather bleak post on X, has claimed that the long-term downward trend in memory and display costs allowed for annual spec bumps without price hikes. In 2026, that model has finally broken, driven by a sharp and unprecedented surge in memory costs.

That unprecedented surge is, of course, driven by AI, as AI data centers require the same memory technologies , meaning that in Peis words for the first time, smartphones are competing directly with AI infrastructure and memory prices are rising sharply as a result.

So just how much of a price increase are we talking? Well, according to Pei, in some cases, memory costs have already increased by 3x, with further rises expected. He added that memory modules which cost less than $20 a year ago could exceed $100 by year-end for top-tier models. https://t.co/ynfCSXu0Yh January 14, 2026 Higher prices or worse specs

The result of this, according to Pei, is that brands now face a simple
choice: raise prices, by 30% or more in some cases, or downgrade specs. This is the opposite of what weve seen in previous years, where components typically get cheaper over time.

Pei predicts that entry-level and mid-tier smartphone makers will
particularly struggle as a result of this, and that Nothings own smartphone prices will inevitably increase too.

But despite this bleak outlook, in Nothings case, Pei argues this is an opportunity, as the company has always focused more on how its phones look
and feel than the raw numbers, so with rising costs, the brand can simply double down on that approach.

He concluded that 2026 is the year the specs race ends. As the industry resets, experience becomes the only real differentiator. That is exactly what Nothing was built for. The era of cheap silicon is over. The era of intentional design is just beginning.

Its a nicely put argument, and hes not wrong that Nothings experience will probably give it an advantage over brands that have traditionally competed primarily on specs, but still, prices will rise that much is bad news for everyone. And even if Nothing itself thrives in this environment, it paints a bleak picture for the smartphone industry as a whole.

Hopefully, this will lead to more creative innovations that dont rely on pure power, but it might instead just mean that fewer phones are made and purchased. We'll see how things play out as the year gets underway.

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Link to news story: https://www.techradar.com/phones/nothing-phones/that-model-has-finally-broken- nothing-ceo-says-the-era-of-bargain-smartphones-is-over-and-that-its-prices-co uld-jump-by-30-percent


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