[Anchor]

The global supply shortage of AI-driven semiconductors has triggered a phenomenon dubbed "chipflation," causing worldwide smartphone shipments to drop to their lowest level in 14 years. This has also heightened the burden on consumers.

Reporter Park Jaehyeon has the details.

[Reporter]

Apple raised prices across the board for its iPhone 18 series released last month.

The factory price of the iPhone Duo has surpassed 3 million won.

The price hike was driven by cost pressures, with soaring memory semiconductor prices playing a major role.

Prices of semiconductors used in PCs and smartphones have surged by up to nearly 10 times in just one year.

This supply shortage occurred as semiconductor companies concentrated their production on high-value-added products such as HBM.

[Sean Kim / Morgan Stanley Researcher (June, Morgan Stanley Podcast): AI companies were able to secure priority supply volumes by entering into long-term contracts and paying in advance. On the other hand, PC and smartphone manufacturers have had to compete for the remaining volume.]

As smartphone manufacturers raise prices to cope with cost burdens, consumers are now closing their wallets.

[Choo Jung-sook / Yangcheon-gu, Seoul: The price is expensive in the first place. It is expensive so I cannot change my phone. It hasn't broken down yet, so I plan to keep using it until it completely breaks down.]

Consequently, global smartphone shipments in the third quarter of this year decreased by 20% compared to the previous year.

This is the lowest level in 14 years since 2012.

The rise in semiconductor prices has led to a drop in consumption and shipments.

While Samsung Electronics recorded a record-high operating profit of 107 trillion won in the third quarter, its mobile and home appliance divisions are estimated to have posted deficits in the trillions of won in the third quarter, following their first-ever deficits in the second quarter.

Recently, even semiconductor equipment and material suppliers have rushed to raise their prices, raising expectations that cost pressures will grow even further.

[Kim Yang-peng / Senior Researcher, Korea Institute for Industrial Economics and Trade: Because demand for manufacturing equipment and materials is also increasing due to rising semiconductor demand, a domino effect is occurring where supplying companies are also raising their prices.]

With shortages and rising process costs, forecasts suggest that chipflation, the semiconductor-driven inflation, will accelerate further.

(Video editing: Lee Sang-min, Design: Seo Seung-hyun, VJ: Lee Ji-hwan)