Chip production contracts from all companies are becoming more expensive, which may affect the price of smartphones.
Over the years, smartphone prices have been getting higher and higher. Price increases can be caused by many factors, such as shortages of raw materials, increasingly complex components, inflation, or simply companies that want to make more profit.
The bad news is that the price doesn’t seem to go up for any reason, but it won’t go any lower either. In fact, the price of a smartphone is still on an upward trend.
According to Bloomberg, Samsung is negotiating with partners to use the company’s chipset manufacturing services, the goal of this negotiation is to be able to increase the price of chip production by 15-20%. However, before criticizing Samsung, Bloomberg also points out that this is an industry-wide trend. Chip production contracts from all companies are becoming more expensive as demand currently outstrips supply.
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This is likely to push smartphone prices even higher in the future, especially for already expensive flagships. The Bloomberg report further confirms that Samsung has completed negotiations with some of its partners and is continuing talks with others.
Samsung is currently the second largest contract chipmaker in the world after TSMC, so Samsung’s price increase could affect many future smartphone models.