Chip Costs Overtake TV Panels for First Time as AI Demand Squeezes Supply
TechRadar reports AI-driven semiconductor demand has made processors as expensive as panels in small TVs, with memory and Wi-Fi module prices surging and shortages expected through 2027.
Citing market research firm Omdia, TechRadar said semiconductor costs have risen so much this year that the most expensive part of a TV may no longer be the panel, but the chips powering it. For now, the problem is primarily at the lower end of the market, including 32-inch LCDs and Full HD models in the low 40-inch range, rather than the best OLED TVs. But component costs continue to soar, TechRadar said.
The cost increases are large. In the second quarter of 2025, the processing board accounted for just over 10 percent of a TV's costs, according to Omdia's figures cited by TechRadar. By the third quarter of 2026, that share had reached 45 percent or even 50 percent of the total cost. Basic DRAM prices hit $25 in August this year, 4.4 times the price a year earlier, while NAND flash memory rose to $30.50, nearly nine times last year's price. Wi-Fi modules increased from $33.90 in 2025 to $118.20 now, making the Wi-Fi chip more expensive than the lowest 55-inch 4K panel at $116 and close to the average 4K panel price of $123.
TechRadar described AI as the "Very Hungry Caterpillar" of technology, consuming so many semiconductors that supplies of crucial components are limited and prices are soaring. The TV market is the latest sector to be affected. The component crisis is expected to continue through 2027 and beyond, squeezing the profitability of manufacturers in a market already known for relatively low profit margins.
The report said manufacturers are unlikely to absorb ever-increasing prices forever. That means the TV market may follow what has already happened in the smartphone market: higher prices and lower specifications.