Smartphones are becoming more expensive every year, but soon the situation may become even worse. According to a new analysis published DigiTimesby using Phone Arenaaccording to some estimates, TSMC is expected to raise prices by 6% in 2023.which should cause a lot of problems for companies, as it is the main supplier of semiconductors for smartphone chipsets.

This increase is not as dramatic and has already been planned and expected, especially given the difficulty of developing more advanced 2nm and 3nm technologies. But it is worth noting that in 2020 TSMS already announced a price increase, which madeproduction costs increase by 20-40% for different clients.

But, as indicated Phone ArenaDespite this increase, several manufacturers made sacrifices last year in order not to increase the final price of smartphones, thereby maintaining their market share. Companies such as Xiaomi cut spending in areas such as marketing In order to keep their models with high-end hardware, but without increasing the final cost, but with other increases, these OEMs will have to reconsider this price control strategy, mainly to avoid layoffs.

Credits: TSMC Disclosure

The portal notes that the analysis counterpoint already indicated A 10% increase in the cost of smartphones sold in North America last year., and the main culprit of this is the problem of rising costs of transport and components. But this value, despite being high, still does not follow the 20-40% increase made by TSMS previously.

But this scenario can still be very interesting for intermediate models. This is because, as mentioned earlier, the main cost increase is due to the new 2nm and 3nm nodeswhich are more difficult to design and manufacture, making them more expensive.

This means that, at least initially, The most dramatic price increase will occur first on high-end smartphonesthat rely more on these smaller processes for their powerful SoCs. So while companies look for ways to keep prices down on more expensive models, it’s possible that entry-level and mid-range devices will still be able to control their price increases and keep their hardware up to date.

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Source: DigiTimes, Phone Arena