Amazon warns: The memory crisis will kill game consoles and PCs—cloud gaming is the only way out

Amazon gaming business负责人 Jeff Gathee pointed out that the surge in memory prices is accelerating the obsolescence of game consoles and PCs, and that cloud gaming will become the only way out for traditional gaming hardware.
（Background: Steam parent company Valve launched a gaming console and VR headsets, with a 2026 release targeting Sony, Nintendo, and Microsoft）
（Additional context: IBM fell 24% premarket! Customers put all their budgets into grabbing memory, and memory demand has surged）

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• Memory price hikes driving up hardware costs
• Business advantages of cloud gaming
• Industry views

Amazon gaming business负责人 Jeff Gathee recently issued a warning that the global memory price surge is pushing game consoles and PCs to the brink of extinction, and that only cloud gaming is the single way out for traditional gaming hardware. Gathee said that as DRAM and NAND chip prices continue to climb, the cost pressure for gaming hardware has reached a turning point. Over the past two years, the price of a 32GB DDR5 memory kit has jumped from about 900 yuan last year to nearly 3,800 yuan now, a fourfold increase—so the cost pressure on PC vendors’ full-system production is easy to imagine.

Memory price hikes driving up hardware costs

The memory crunch is not a short-term phenomenon. Since 2025, major global memory makers Samsung, SK hynix, and Micron have continued raising DRAM prices, and NAND Flash followed suit, directly increasing the manufacturing costs of game consoles and PCs.

Gathee pointed out that currently only a small portion of players own traditional game consoles or high-performance PCs. By contrast, global smartphone annual sales exceed 1 billion units. Cloud gaming can deliver the gaming experience directly to these devices without needing to purchase expensive hardware.

Business advantages of cloud gaming

From a business perspective, cloud gaming gives Amazon multiple advantages:

• Stable subscription revenue: Amazon Luna cloud gaming service uses a subscription model, providing predictable recurring income
• Prevents game tampering and piracy: Play through the cloud reduces the risk of game modification and piracy
• Shifts hardware costs: Compute runs in data centers, so players don’t need to buy high-spec devices

For Amazon, cloud gaming is a more profitable business model than selling hardware.

Worth noting is that Amazon Luna recently announced it has entered Fire TV via the Prime Video app, covering the US and UK markets. Prime members can use it directly without paying extra.

Industry views

Cloud gaming’s experience still has clear shortcomings. Stuttering issues caused by network latency have not been fully resolved, limiting practicality for users in areas with poor network conditions. Subscription fees also won’t decline over time, so long-term costs may not necessarily be lower than buying hardware.

Industry analysts believe whether cloud gaming can replace traditional gaming devices is still hard to conclude in the short term, but the memory price surge is indeed accelerating this trend. The cost pressure facing console manufacturers cannot be ignored, and the future direction is worth continued attention.