History has a tendency to repeat itself, and the current AMR crisis is not an entirely new problem. In the late 1980s, people were buying a lot of personal computers, which meant PC makers had to buy more RAM. Eventually, that demand for PCs slowed, leaving those same manufacturers with excess inventory, including additional chips that weren’t installed in computers. This shift between supply and demand triggered a domino effect that resulted in a decline in production and, when demand caught up with supply, RAM prices skyrocketing.
Just as today is not a great time to buy a new computer or game console, it was also not a good time to buy a new PC in the 1980s. The same was true for anyone who needed to fill up a car with gas. The first involved accusations that Japan was flooding the U.S. market with RAM, which caused its price to drop, but new sanctions subsequently caused the price to rise. The latter has experienced geopolitical instability and conflict in major oil-producing regions, as well as a decline in demand compared to previous decades. Today, RAM prices are becoming too high due to AI data centers needing more computing power. Oil, on the other hand, is expensive, in part because of the conflict in Iran.
The increasing cost of RAM is impacting the gaming industry, leading to rising prices of consoles and hardware. The 1988 crisis also affected gaming companies, such as when Nintendo had to delay the American release of Zelda II: The Adventure of Link. Even with these trials and tribulations, Nintendo and the economy as a whole recovered from the RAM and gas crisis of the 1980s, so perhaps history can teach us something about our current situation.
The RAM of the 1980s and the oil crisis
The demand for RAM in the early and mid-1980s led to overproduction as manufacturers tried to get their piece of the pie. At the same time, chipmakers in other countries — notably Japan — have introduced low-cost alternatives to the U.S. market. With so much RAM being produced and its initial drop in price, manufacturers began creating fewer chips, while the U.S. government imposed sanctions on Japan, limiting the importation of chips made in that country. This destroyed what was once a stockpile of RAM in the United States and caused prices for electronic components that relied on memory to rise rapidly.
By the summer of 1988, the cost of RAM had skyrocketed. The price rose from about $199 to $505 for a megabyte of RAM, with the cost of a $256,000 DRAM chip rising from $2.95 to $12.45 in a matter of weeks. This has led many people to avoid purchasing tokens until the price drops. Some companies didn’t so much avoid purchasing RAM as they simply couldn’t do it, or at least couldn’t afford it. These are also the kinds of difficulties facing companies today, with (for example) Valve having trouble getting RAM for its Steam Machine. Meanwhile, the oil glut of the late 1980s led to a drastic drop in prices, which was beneficial for commuters but devastating for some countries and even states (like Texas).
Eventually, oil and gas prices rose again as conflicts in the Middle East tightened supplies, and the two commodities – RAM and oil – continued their roller coaster journey. Today, AI data centers are causing the prices of things like RAM to skyrocket, as we hope for the kind of price relief that overproduction brought, if only briefly, in the 1980s.
What can we learn today?
Looking at what happened in the past can help find solutions for the future. This particular conversation has flourished on several online forums, where users discuss the possibility of RAM returning to normal pricing or at least decreasing towards more reasonable ranges. Reddit users are wondering if we will ever see RAM return to a lower price, with the general consensus being that the price will continue to rise until people stop buying, thereby reducing demand.
This discussion is exactly what happened during the RAM shortage in the 1980s, where supply and demand played a large role in price fluctuations. Today, companies like Xbox, PlayStation, Nintendo and Valve have increased the price of their consoles due to the lack of RAM. Valve’s latest console is here, but you might not want to buy a Steam Machine in 2026. The console could have been a few hundred dollars cheaper if not for the lack of RAM as well.
As prices of everything electronic continue to rise, will consumers eventually reach a breaking point and stop buying? This is sort of what happened in the 1980s when RAM prices initially fell. The real problem, however, was not the sky-high prices but the glut of available RAM, which forced manufacturers to lower prices if they hoped to sell any. Perhaps the real lesson of the RAM and oil crisis of the 1980s is that there will always be cycles as markets attempt to make corrections. The good news might be that these corrections sometimes involve innovations, like the advent of more fuel-efficient cars in response to the oil shortages of the 1970s… which, of course, ultimately contributed to the glut of the following decade.
