Chip crunch gives tablets the edge: Budget laptops feel the memory squeeze

Rising memory prices are squeezing budget laptops in India, driving cost-conscious consumers towards tablets

Surging memory chip prices are reshaping India’s personal computer (PC) market, squeezing the price-sensitive sub-₹50,000 laptop segment and triggering a shift towards tablets.

 

Memory costs have increased from 10–15 per cent of a computer’s retail price to nearly 50 per cent, nudging budget-conscious buyers to abandon entry-level laptops for ₹20,000–30,000 tablets, according to industry executives and analysts.

 

Device makers are taking note. Over the past few months, brands like Huawei, HP Inc, Samsung, Lenovo and Asus have either entered the category, returned to it, or expanded their tablet portfolios.

 

In March, ecommerce giant Flipkart put up a Huawei microsite to tease a tablet-sized product. The suspense ended shortly after with the launch of the 11.5-inch Huawei MatePad — marking the Chinese company’s return to the Indian market after more than six years.

 

Huawei returns at a time when the tablet market is growing, helped by memory prices’ impact on affordable laptops.

 

The shift is showing up in the numbers. While India’s overall tablet market grew 5 per cent year-on-year (Y-o-Y) in the April–June quarter, demand for larger screens surged. Sales of 13-inch-plus models skyrocketed by 338 per cent, while 12-to-12.9-inch tablets jumped 76 per cent, and 11-to-11.9-inch devices grew 29 per cent.

 

“Adding to it is the strong demand momentum from earlier quarters, along with tablets being viewed as a value-efficient alternative to laptops and smartphones amid sharp memory price increases across categories. On the supply side, domestic manufacturing has been growing strongly as more brands shift their portfolios towards localised products,” market research firm Counterpoint said. 

 

Huawei isn’t alone. PC major HP is re-entering the Indian tablet market with the OmniPad 12 — ending a 15-year hiatus that began in 2011 — while Samsung, Lenovo and Asus are all rolling out new models or expanding their lineups.

 

The market is changing as consumers demand tablets with better connectivity and higher memory configurations.

 

“Wi-Fi tablet shipments grew 30 per cent Y-o-Y, while 5G tablets increased 8 per cent and 4G shipments declined 19 per cent. Demand also shifted towards higher-performance configurations, with 6GB tablets growing 73 per cent and 12GB variants surging 422 per cent,” said market research firm Cybermedia Research (CMR).

 

Samsung led the market with 30 per cent Y-o-Y growth in sales and an overall 34 per cent market share, while Apple’s tablet segment sales grew 28 per cent year-on-year. Apple’s iPad 11 drove more than 70 per cent of the company’s overall tablet sales.

 

Driving this trend is a dramatic shift in PC economics. Arnold Su, vice-president for consumer and gaming PC at Asus India, said the cost of memory chips has ballooned to nearly 50 per cent of the average selling price of laptops and personal computers, up from 10-15 per cent about two to three years ago.

 

The impact weighs on India given its reliance on affordable laptops. The sub-₹50,000 segment drives nearly 40 per cent of the country’s total PC market, whereas Chromebooks account for just 2–3 per cent.

 

As memory prices climb, budget laptops face the brunt of the squeeze — creating room for tablets to position themselves as cheaper alternatives.

 

“A further increase in the cost of memory chips, which seems inevitable at this point, will hit the sub-₹50,000 laptop segment the most. We estimate that around 10-15 per cent of this buyer segment will drop down to buying a ₹20,000-30,000 tablet for the time being,” said an executive of an original equipment manufacturer, asking not to be named.

 

For companies such as Asus, which has entered the Chromebook and tablet segments, the best opportunity is until memory prices ease and supply chains are restored.

 

However, executives such as Asus’ Su believe that the tablet surge isn’t just a reaction to chip shortages. Beyond short-term memory inflation, hardware makers are aiming to capture a younger, mobile-first audience just entering the workforce.

 

That raises a larger question for the industry: Will people buy tablets once memory prices stabilise and affordable laptops regain their price advantage?

 

“Considering the SSD and NAND shortage, tablets will be required in the next one or two years. But whether tablets will be required after these two years and over the next five years, I am not 100 per cent sure,” Su told Business Standard in a recent interview, referring to memory devices.

 

To sustain momentum beyond the component crunch, analysts say manufacturers will have to turn tablets into more capable productivity devices rather than positioning them as media players.

 

Sustained growth of mid-to-high-end tablets — excluding devices such as Apple’s iPad — will depend on how brands pack performance into future models, an analyst said.

 

“So tablets will no longer be just the Netflix and chill kind of device for a single user. It may become the default device for a school- or college-going student provided it has AI (artificial intelligence) features, smooth screen and longer battery backup,” the analyst said.

 

This shift won’t happen uniformly across the budget PC market. While some sub-₹50,000 laptop buyers will trade down to ₹20,000–30,000 tablets, experts said others may stretch their budgets to buy premium models within the tablet category, experts said.

 

“The Indian tablet landscape is maturing, marked by a decisive shift towards higher-spec devices. Rising component costs, alongside consumer preference for larger screens, increased RAM, and robust Wi-Fi connectivity, are pushing average selling prices higher,” said Menka Kumari, a senior analyst at CMR.

 

The tablet opportunity stems from two distinct drivers. In the short term, high memory costs weaken the value proposition of budget laptops, pushing buyers toward tablets. Long term, manufacturers are betting that bigger screens, higher memory, and AI capabilities will turn tablets into credible primary devices for students and young professionals.

 

Once memory supply chains stabilise and prices drop, some buyers will inevitably return to laptops. Even so, analysts expect tablets to stay firmly entrenched as secondary devices for media consumption and schoolwork.

 

Amid the current momentum, tablet makers face risks. High component costs and memory shortages could spill over from laptops to squeeze tablet production, while uncertain institutional procurement threatens shipments through the rest of the year.

 

“Supply-side pressures, including rising component costs, memory shortages, and delays in institutional procurement, are expected to impact shipments in the second half of 2026, though premium devices and AI-ready hardware will continue to anchor market value,” Kumari said.