In the boardroom and the data centre, the conversation is currently dominated by a single piece of hardware: the GPU. As we scale our enterprise broadcast platforms to meet the new demands of generative modelling, the scramble for Nvidia H100s has become a daily operational reality. However, as a “Product Person” tasked with managing long-term infrastructure P&L, I am increasingly concerned that we are looking at the wrong shortage. The real crisis is not the processor; it is the memory that feeds it.
The cannibalisation of the silicon wafer
The logic of the current semiconductor pivot is simple yet devastating. As giants like Samsung and SK Hynix retool their factories to produce High Bandwidth Memory (HBM) for AI chips, they are physically removing capacity from the standard DDR5 market. This is not merely a shift in focus; it is a physical displacement of resources that impacts every enterprise hardware roadmap.
We must understand the three-to-one rule that governs this transition. HBM is notoriously inefficient to manufacture compared to standard consumer RAM. It requires roughly three times the wafer area to produce the same amount of memory capacity. For every high-end AI chip that leaves the factory, three sticks of standard enterprise memory effectively die on the drawing board. This cannibalisation is happening at the level of the silicon wafer itself. The machines and raw materials that once produced the backbone of our server clusters are now dedicated to a far more lucrative, but far less efficient, product.
The mirage of the current glut
It is difficult to sound the alarm when prices are at historic lows. As of March 2023, the industry is still working through a post-pandemic oversupply of memory modules. To many procurement leads, RAM feels like a cheap commodity that will always be available in abundance. This is a dangerous mirage.
Manufacturers are already reacting to these low margins by slashing production and accelerating the transition to HBM. We are currently in the calm before the storm. The current glut will evaporate as production cuts take hold and the cannibalisation effect of AI memory begins to bite. In my previous years managing agency projects, I learned that the most dangerous bottlenecks are the ones you take for granted. Just as I once restricted my own creative inputs to a single musical artist to find focus, the market is now restricting its manufacturing output to a single high-margin product. We are trading the resilience of the broad memory market for the performance of a few elite chips.
Strategic resilience in a memory-constrained world
The economic impact of this shift will be felt far beyond the AI labs of Silicon Valley. In 2025 I anticipate a period of significant “RAM-flation” where the cost of a standard enterprise server or high-end smartphone rises not because of the processor, but because of the memory modules. For those of us in the live broadcast sector, where low latency and massive data throughput are non-negotiable, this is a direct threat to our operating margins.
We cannot optimise our way out of a physical supply shortage. Unlike software bloat or inefficient code, you cannot patch a missing silicon wafer. As strategic leaders, we must move beyond the short-term satisfaction of current low prices. This is the time to lock in long-term supply contracts and audit our hardware roadmaps. If your product strategy relies on cheap, abundant memory to scale, you are building on a foundation that is rapidly being liquidated.
While the world fights over GPUs today, the smart move is to secure the memory of tomorrow. The AI revolution is being built on silicon that is being stolen from the rest of the industry. Don’t wait for the price spikes of 2025 to start thinking about your memory supply chain; by then, the wafers will already be gone.
