7x increase in memory costs fueling price increases in ISP-provided routers, gateways, and set-top boxes — home fiber rollouts may slow, and installations could become more expensive

It's long been said that the insane rise in DRAM pricing would eventually affect common household electronics, and those predictions are starting to come true, likely sooner than most people imagine or would like to admit. The latest casualty is the market for ISP-provided broadband routers, set-top boxes (STBs), and gateways, which could see prices for the memory they require rise sevenfold.

Counterpoint researchers state that this steep climb should last at least through June, and is likely to continue due to the ongoing supply crisis. Whereas memory used to account for about 3% of the average bill of materials (BOM) for producing one of these pieces of equipment, that percentage has now ballooned to 20%, and it will have an outsized influence on the equipment's final price.

While this likely won't have a direct impact on the monthly price of your internet connection, the usual "free installation" and similar deals, such as a free set-top box, may disappear over time. The graph below shows a significant difference in LPDDR4 pricing for mobile phones versus the standard DDR4 used in consumer-facing telco gear.

According to Counterpoint, routers could be affected the most, as the OEMs of these devices don't tend to have the kind of negotiation power and long-term supply contracts as the bigger industry players. DDR4 was already being phased out before the crisis hit, and supply constraints forced a surge in prices. The fact that the AI craze led to the addition of memory-hogging features in routers and STBs didn't help matters, as some equipment has as much RAM as a common PC.

The market researchers also note that this problem may even affect ISP fiber rollouts. It's not hard to imagine that the combined price of the equipment becomes a significant factor, especially when the time comes to pass the costs on to consumers, who may balk at paying for equipment that was often "free" for many years.

Even big telecom and phone gear manufacturers have started specifically calling out the problem in their quarterly earnings statements. In the statement for its Q4 2025 results, Nokia's CEO said that although "at a macro level across the company, [RAM pricing] is not a huge part", the firm intends to "secure the supply based on the commitments [it does have]" and that "[it expects ] to be passed through to pricing".

Meanwhile, MediaTek reportedly stated that it's got enough memory for its datacenter needs, but that for other segments it will "adjust its pricing to reflect the rising supply chain costs and allocate our supply across products based on the overall profitability". Likewise, Qualcomm's CEO said that, with data centers as priority #1, "industry-wide memory shortage and price increases are likely to define the overall scale of the handset industry through the fiscal year."