SSD Prices Soar as AI Industry Expands: Samsung raises prices by 20 to 25 percent

The reason for the increase in SSDs is the boom in the artificial intelligence industry, and Samsung significantly influences pricing decisions because it supplies about 50 percent of the business SSD market, writes Business Korea

by Sededin Dedovic
SSD Prices Soar as AI Industry Expands: Samsung raises prices by 20 to 25 percent
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The field of SSDs has witnessed a significant price escalation in the last year. Samsung announced a price increase of 20 to 25 percent in the second quarter, surpassing the initially projected jump of 15 percent, which was already enough cause for concern.

This marks a significant jump, driven primarily by the boom in the artificial intelligence (AI) industry. The recent rise in global demand for NAND flash SSDs can be attributed to the growing need for new data centers and the rapid proliferation of AI-connected storage servers.

Samsung, the dominant player supplying approximately 50 percent of the enterprise SSD market, has a significant influence on price dynamics, as reported by Business Korea. Projections of market trends by TrendForce, a renowned market research company, indicate that where Samsung leads, others follow suit.

Accordingly, the expected price jump of 20-25 percent is poised to reverberate throughout the market, spreading beyond the purview of the South Korean giant and its enterprise SSD solutions. Realization of the upcoming SSD price increase is not unfounded.

Samsung's decision to raise prices stems from multiple interactions of market forces, including low fill rates for large SSD orders, forcing suppliers to influence price trends, thereby pushing consumers to accept higher costs.

As certain buyers look to increase their inventory ahead of the expected peak season in the second half of 2024, contract prices for enterprise SSDs are forecast to increase by 20-25 percent in the second quarter, marking the most significant increase across all product lines, explains Brian Ao from TrendForce.

While consumer eMMC and SSDs are poised to echo price increases, they are likely to stay within the initially announced range of ten to 15 percent, unlike their enterprise counterparts. The growing demand for SSD drives, fueled by the relentless march of AI technologies, has once again proven to us how important this type of data storage hardware is in the digital era.

The trajectory of SSD prices will inevitably influence strategic decisions across industries, steering the delicate balance between technological progress and economic reality.