Shrinkflation is the diminution in product quality and/or volume to resist raising prices due to inflationary pressure. This has been happening in the USA since roughly 2001. Gadgets largely improved anyway though the market transitioned from metal and wood casings to brittle plastics, and there were other sacrifices made.
This, however, isn’t shrinkflation. This is supply chain, demand, and uncertainty.
It’s partially that the value of the dollar has been diluted a lot over the decades, and people are in denial about it. Earning 100k is not „a good salary“.
OK, every time I see a comment about income on the internet, I have to assume that the person commenting has zero IQ if they mention nothing about COL.
The same happens when someone mentions something about the Average income as opposed to the median income. The average income is meaningless if the top 1% keep going up while the rest of the system stays the same. The average would look like people are earning more money when they're not.
Same thing with Market economics and the price of items. If I got a choice to sell a boner pill for $1 to a million people and $1 million to one person, those are equal value propositions. So whenever a corporation raises prices, they don't care how many customers they cut off as long as the remaining ones are whales. That's particularly sharp with all the AI costs being shoved into the pipe.
So, that is to say, you really shouldn't just produce a single number about anything and treat it as some benchmark across the world.
The article is wrong with their Apple example. The cheapest Mac mini with the smallest amount of RAM is no longer available, but the next larger config is available at the same unchanged price point.
The MacBook Neo proves that gadget "shrinkflation" is largely a choice. I own an Neo and I continue to marvel at how capable, nice, and yet inexpensive it was.
If a brand decides to release a budget version of their expensive product with a value-for-money proposition ... that is not shrinkflation IMO. (whether that value-for-money proposition is mere marketing hype or well received and is closer to reality ... is secondary)
If seemingly the "same" product -- in this example say 'MacBook Pro' base model for current year -- delivers less goodness, less value compared to its price year-on-year. If the price appears to stay more or less the same but the product is made weaker in service of higher margins for the seller. THAT would typically qualify as shrinkflation ... in my understanding.
This is more objectively measurable in comsumer goods where you can see the packaging being tinkered with over time so consumer thinks they are getting the same SKU but this year's packaging has less of the product tghan last year's, at similar price point so it doesnt register as price inflation.
You have to keep in mind, the less capable you are with computers, the more computer you need. You might get by just fine on 8 GB, but Grandma, with her three anti-malware suites, two active malware infections, corporate spyware, and fake version of Google Chrome which reports all browsing usage to the Neilsen corporation, is going to slow to a crawl, at best, even on 16gb. Normal people computers are different than yours or mine.
We squeezed everything we could squeeze over the last decades, getting better products / quality of life (in the west at least). Now that there is almost no one left to abuse (ie people on the other side of the planet willing to work for pennies) we'll have to get by with shittier products, more working hours, later retirement, worse public services, etc.
Many product segments peaked and the only way left to extract more money from us is to either lower the quality so that it's cheaper to make/break faster or subscriptions/ads.
Almost every global graph tells the opposite story. There are far fewer people in poverty. There are much better average outcomes on basically every metric you can imagine. Almost all directly attributed to global commerce
Why do we have to get by as you say? On whose command?
Why do we always act like there's an immutable social obligation to march right along believing the prior generations had freedom to start marching in that direction, but we are forever locked in to such a direction.
You know all the people that made those choices are dying and future generations have zero obligation to carry on linearly from where they left off?
Women would not have the right to vote. We'd all be speaking Latin.
Two things that would remain true if society of the living was tightly coupled to exactly how the past worked.
The original comment has conflated every ill into "have to", combined with political fatalism. Not unreasonable given the way things have turned out, but yes it's not inevitable either. It's just the direction of travel that the majority chose.
Certain "have to" are imposed by the physical world. The world will have to use less oil in 2026 than in 2025, because production has been so heavily impacted by the war. What happens beyond that .. well, only a fairly small number of people get to make that decision. Next US presidential election is in 2028.
Your comment is devoid of content, of substance. Just more parroting of obligations that do not exist.
You're not struggling to understand my comment. You're struggling to think altogether when your argument is "well because random political choice in 1979, we must today in 2026..." type reductive, functional illiteracy.
But ok; to we must coddle the past to satiate some. Well, debt jubilees are things humans have done before. Wipe the ledger and start counting again. What is grandpa going to do? Rise from the grave?
>> That can’t continue as the rest of the world is catching up.
This has already been happening quietly in several industries.
I remember many years ago when I was working in a bike shop (early aughts) and the Specialized engineer was talking about how Taiwan used to be the brunt of the jokes in the bike world for decades. He went on a rather long rant about how over that same time, they had essentially dumped billions into becoming a technological behemoth when it came to bike manufacturing. Their factories were so far advanced, and their engineers were so highly qualified, that many bike companies (including Specialized) were moving their manufacturing back to states because it had become too expensive to continue using the Taiwan factories.
You don't have to do anything, nobody cares about individuals when you have 8 billions. The masses, on average, want cheap simple fun, cheap stuff and so on. Market responds. Good luck trying to change that.
Sure, there is some market manipulation, ads are the best example (how can any adult with even a smidge of self-respect accept any ads in any form is beyond me, thats mind slavery 101) but since forever masses wanted bread and games more than literally anything.
All those companies making high quality expensive products that lasted decades? Barring tiny exceptions, they either went down with quality (less control, move to china etc) or went bankrupt.
Parent is right in 1 aspect - if we elevate whole world to similar income levels, the income of previously-rich countries will have much less purchasing power, can't escape simple numbers. But who cared in the past about slave kids in sweat shops, right, they didn't have the right skin color, passport or religion to worry about.
We can see this with the Lenovo Legion 2026 models. They literally perform worse than the 2025 models and cost more. Not only that, the build quality was cut for 2026.
I know Apple is escaping it due to their large contracts but I’m honestly not sure how at this point. They must have pre-purchased multiple years of memory or otherwise have a really insane contract.
But what’s puzzling about that is, why don’t other manufacturers have the same kind of deals? It’s not like Lenovo is a low volume supplier.
Obviously, the iPhone sells in volume unmatched by other devices. But still…I’d have to ask why other high-volume brands like Samsung have wildly expensive laptops.
It just seems like the other companies are asleep at the wheel and don’t have any passion for their strategy, to the point where a tiny company like Framework is overperforming just by caring a little bit. Sure, they can’t beat Apple on raw value but they at least they put together a laptop with a respectable trackpad and a CNC body. Where is volume leader Lenovo?
All big vendors will place orders some distance into the future. Lenovo does it, too.
You can't lock in prices forever, though. The more volume and stability you have, the more a vendor will be willing to enter long-term agreements with you. Lenovo has less volume than Apple and is not in as great of a financial position, so they don't have as much leverage.
The bigger factor is that Apple already had more margin in their products. The price premium for RAM upgrades on Apple laptops is large, as everyone knows. They could absorb more RAM price increases without being forced to raise retail prices.
I really don't understand why more companies don't emulate Apple in terms of line simplicity. Look at Dell for a great example of a sprawling product mix. I can't imagine having that many product varieties helps with profitability.
In the consumer space, I recently bought a Sonicare toothbrush, and the number of models and combinations is staggering. 1000x plaque removal, 750% plaque removal, it's ridiculous.
Apple has a unique market position due to their OS. A buyer shopping for a Mac can't visit multiple vendors and compare models.
Dell and Sonicare do not have that luxury. They are competing with other PC vendors and other toothbrush vendors.
The strategy is to produce so many models that you appear to serve every price point and need without requiring the user to shop around. You can find something in their lineup that fits your budget or requirements if you look long enough and you don't feel like you need to go looking around at competing vendors as much.
Having may models isn't a high cost because they share so many parts. I bet if you opened multiple Sonicare toothbrushes they'd share many main components like batteries or motors. Dell has a few laptop and desktop lines but they're different combinations of parts within a shared chassis.
But if you read their actual financial reports they have never indicated in any way that their hardware is a loss leader. They disclose this information publicly since they are publicly traded. Yes, the services revenue is higher than Macs and iPads combined and is at a higher profit margin, but hardware also makes a lot of money.
Apple’s only structural advantage should be their custom silicon, but I don’t think that’s a cost advantage as much as it’s a performance and battery life advantage. Apple is still buying huge dies from TSMC and designing them custom themselves which is not cheap. Lenovo shares the cost of designing an Intel, AMD, or Qualcomm chip with dozens of OEMs. Same deal with software: I wouldn’t be surprised if macOS costs more per unit for Apple than Windows costs for Lenovo considering all the employees Apple hires directly to develop it.
Apple in theory should be paying a pretty similar amount of money to make the rest of their systems. They don’t make camera sensors, displays, keyboards, DRAM chips, or anything else themselves.
I'm not even looking at Lenovo's profits. I'm comparing their revenue to Apple's profit just to emphasize the difference in scale.
By the numbers, Apple is a smartphone business that has a casual side hobby of also being the #4 PC maker. Their PC sales are ~3x less than Lenovo's, but their smartphone sales are 10x their PC sales. There's plenty of commonality so the massive smartphone business surely helps with supply on the computer side of things as well.
Apple prioritizes price stability over price competitiveness. They will happily charge formerly eye-watering prices for extra RAM and their customers will less happily pay them. On the other hand, Apple rarely change their prices after release except in cases of extreme currency devaluation. They simply raise the price when the new model comes out.
They do this for their own reasons but it's helping them in this crisis. They can simply accept lower margins in the short term, in the knowledge that in the long term these price fluctuations even out.
From the perspective of the producers Apple are a consistent purchaser with deep pockets. AI companies may be willing to pay more for RAM in the short term, but Apple is a safer customer. The current AI bubble may or may not burst, but people will keep buying iPhones regardless. The producers do not want to freeze Apple out because Apple is their hedge against the bubble bursting.
Lenovo may not be a low volume purchaser but they are not at Apple's scale nor are Lenovo's customers willing to pay the premium that Apple's customers are.
I don’t think we’ve seen the lower margins in Apple’s financial reports.
Also, their computers have been getting more storage/RAM competitive as time has gone on. Literally just by time passing and prices staying the same.
Lenovo is beyond Apple’s scale when it comes to PC sales. They are #1 in volume. Apple is #4. Apple sells more iPhones but Lenovo does also own Motorola which is not nothing. We can also look at Samsung: a wildly high volume company who has their own production lines of major components like RAM and displays but they still sell their 2026 laptops at eye watering price increases.
Lenovo is beyond Apple’s scale, sure, but Apple has relatively few product lines. I imagine that makes it so the few parts they end up doing they have massive volume on.
And then Google is moving at full speed to lock-up the whole Android experience (bootloaders, OS, app store, etc.) so that even tech-savvy consumers are forced to get new, crappier devices when the old ones start slowing down. Enshittification at its highest level
Wait until Shrinkflation meets AIflation, where most services once mediated by humans are taken over by dumb, error-prone, allucinating AI, with no possibility of recourse.
Shrinkflation is the diminution in product quality and/or volume to resist raising prices due to inflationary pressure. This has been happening in the USA since roughly 2001. Gadgets largely improved anyway though the market transitioned from metal and wood casings to brittle plastics, and there were other sacrifices made.
This, however, isn’t shrinkflation. This is supply chain, demand, and uncertainty.
It’s partially that the value of the dollar has been diluted a lot over the decades, and people are in denial about it. Earning 100k is not „a good salary“.
OK, every time I see a comment about income on the internet, I have to assume that the person commenting has zero IQ if they mention nothing about COL.
The same happens when someone mentions something about the Average income as opposed to the median income. The average income is meaningless if the top 1% keep going up while the rest of the system stays the same. The average would look like people are earning more money when they're not.
Same thing with Market economics and the price of items. If I got a choice to sell a boner pill for $1 to a million people and $1 million to one person, those are equal value propositions. So whenever a corporation raises prices, they don't care how many customers they cut off as long as the remaining ones are whales. That's particularly sharp with all the AI costs being shoved into the pipe.
So, that is to say, you really shouldn't just produce a single number about anything and treat it as some benchmark across the world.
RAM prices experiencing a spike due to a demand shock is not shrinkflation. Its a single COGS line item not a broad increase across all line items.
Note: some single item shocks can lead to broad inflation (eg: oil) but that effect takes awhile to play out.
The RAM/SSD price spikes are not shrinkflation, but the article gives examples of shrinkflation happening due to it:
* Google's upcoming folding phone is going to have less RAM than the current model.
* Motorola has both increased the price on their Razr flip phone and downsized the minimum storage
* Sony reduced storage on the PS5 Slim
...
The article is wrong with their Apple example. The cheapest Mac mini with the smallest amount of RAM is no longer available, but the next larger config is available at the same unchanged price point.
The MacBook Neo proves that gadget "shrinkflation" is largely a choice. I own an Neo and I continue to marvel at how capable, nice, and yet inexpensive it was.
If a brand decides to release a budget version of their expensive product with a value-for-money proposition ... that is not shrinkflation IMO. (whether that value-for-money proposition is mere marketing hype or well received and is closer to reality ... is secondary)
If seemingly the "same" product -- in this example say 'MacBook Pro' base model for current year -- delivers less goodness, less value compared to its price year-on-year. If the price appears to stay more or less the same but the product is made weaker in service of higher margins for the seller. THAT would typically qualify as shrinkflation ... in my understanding.
This is more objectively measurable in comsumer goods where you can see the packaging being tinkered with over time so consumer thinks they are getting the same SKU but this year's packaging has less of the product tghan last year's, at similar price point so it doesnt register as price inflation.
You have to keep in mind, the less capable you are with computers, the more computer you need. You might get by just fine on 8 GB, but Grandma, with her three anti-malware suites, two active malware infections, corporate spyware, and fake version of Google Chrome which reports all browsing usage to the Neilsen corporation, is going to slow to a crawl, at best, even on 16gb. Normal people computers are different than yours or mine.
We squeezed everything we could squeeze over the last decades, getting better products / quality of life (in the west at least). Now that there is almost no one left to abuse (ie people on the other side of the planet willing to work for pennies) we'll have to get by with shittier products, more working hours, later retirement, worse public services, etc.
Many product segments peaked and the only way left to extract more money from us is to either lower the quality so that it's cheaper to make/break faster or subscriptions/ads.
Almost every global graph tells the opposite story. There are far fewer people in poverty. There are much better average outcomes on basically every metric you can imagine. Almost all directly attributed to global commerce
Why do we have to get by as you say? On whose command?
Why do we always act like there's an immutable social obligation to march right along believing the prior generations had freedom to start marching in that direction, but we are forever locked in to such a direction.
You know all the people that made those choices are dying and future generations have zero obligation to carry on linearly from where they left off?
Women would not have the right to vote. We'd all be speaking Latin.
Two things that would remain true if society of the living was tightly coupled to exactly how the past worked.
The original comment has conflated every ill into "have to", combined with political fatalism. Not unreasonable given the way things have turned out, but yes it's not inevitable either. It's just the direction of travel that the majority chose.
Certain "have to" are imposed by the physical world. The world will have to use less oil in 2026 than in 2025, because production has been so heavily impacted by the war. What happens beyond that .. well, only a fairly small number of people get to make that decision. Next US presidential election is in 2028.
This is a valid point but I’m struggling to understand what it has to do with the gp comment.
The reality is the West has been leaning on cheap labour for decades. That can’t continue as the rest of the world is catching up.
This is a good thing even though it will be painful for people used to consuming cheap goods from Asia and other parts of the world.
Your comment is devoid of content, of substance. Just more parroting of obligations that do not exist.
You're not struggling to understand my comment. You're struggling to think altogether when your argument is "well because random political choice in 1979, we must today in 2026..." type reductive, functional illiteracy.
But ok; to we must coddle the past to satiate some. Well, debt jubilees are things humans have done before. Wipe the ledger and start counting again. What is grandpa going to do? Rise from the grave?
> What is grandpa going to do? Rise from the grave?
If he did, he'd jump right back in
>> That can’t continue as the rest of the world is catching up.
This has already been happening quietly in several industries.
I remember many years ago when I was working in a bike shop (early aughts) and the Specialized engineer was talking about how Taiwan used to be the brunt of the jokes in the bike world for decades. He went on a rather long rant about how over that same time, they had essentially dumped billions into becoming a technological behemoth when it came to bike manufacturing. Their factories were so far advanced, and their engineers were so highly qualified, that many bike companies (including Specialized) were moving their manufacturing back to states because it had become too expensive to continue using the Taiwan factories.
You don't have to do anything, nobody cares about individuals when you have 8 billions. The masses, on average, want cheap simple fun, cheap stuff and so on. Market responds. Good luck trying to change that.
Sure, there is some market manipulation, ads are the best example (how can any adult with even a smidge of self-respect accept any ads in any form is beyond me, thats mind slavery 101) but since forever masses wanted bread and games more than literally anything.
All those companies making high quality expensive products that lasted decades? Barring tiny exceptions, they either went down with quality (less control, move to china etc) or went bankrupt.
Parent is right in 1 aspect - if we elevate whole world to similar income levels, the income of previously-rich countries will have much less purchasing power, can't escape simple numbers. But who cared in the past about slave kids in sweat shops, right, they didn't have the right skin color, passport or religion to worry about.
tech peaked at the PS Vita and I am not joking
We can see this with the Lenovo Legion 2026 models. They literally perform worse than the 2025 models and cost more. Not only that, the build quality was cut for 2026.
I know Apple is escaping it due to their large contracts but I’m honestly not sure how at this point. They must have pre-purchased multiple years of memory or otherwise have a really insane contract.
But what’s puzzling about that is, why don’t other manufacturers have the same kind of deals? It’s not like Lenovo is a low volume supplier.
Obviously, the iPhone sells in volume unmatched by other devices. But still…I’d have to ask why other high-volume brands like Samsung have wildly expensive laptops.
It just seems like the other companies are asleep at the wheel and don’t have any passion for their strategy, to the point where a tiny company like Framework is overperforming just by caring a little bit. Sure, they can’t beat Apple on raw value but they at least they put together a laptop with a respectable trackpad and a CNC body. Where is volume leader Lenovo?
This has always been my question of why don’t companies just directly emulate Apple.
If lenovo is buying a billion chips a year, why can’t they lock in like Apple?
All big vendors will place orders some distance into the future. Lenovo does it, too.
You can't lock in prices forever, though. The more volume and stability you have, the more a vendor will be willing to enter long-term agreements with you. Lenovo has less volume than Apple and is not in as great of a financial position, so they don't have as much leverage.
The bigger factor is that Apple already had more margin in their products. The price premium for RAM upgrades on Apple laptops is large, as everyone knows. They could absorb more RAM price increases without being forced to raise retail prices.
I really don't understand why more companies don't emulate Apple in terms of line simplicity. Look at Dell for a great example of a sprawling product mix. I can't imagine having that many product varieties helps with profitability.
In the consumer space, I recently bought a Sonicare toothbrush, and the number of models and combinations is staggering. 1000x plaque removal, 750% plaque removal, it's ridiculous.
Apple has a unique market position due to their OS. A buyer shopping for a Mac can't visit multiple vendors and compare models.
Dell and Sonicare do not have that luxury. They are competing with other PC vendors and other toothbrush vendors.
The strategy is to produce so many models that you appear to serve every price point and need without requiring the user to shop around. You can find something in their lineup that fits your budget or requirements if you look long enough and you don't feel like you need to go looking around at competing vendors as much.
Having may models isn't a high cost because they share so many parts. I bet if you opened multiple Sonicare toothbrushes they'd share many main components like batteries or motors. Dell has a few laptop and desktop lines but they're different combinations of parts within a shared chassis.
Because Apple has the capital to take a loss on hardware indefinitely due to the App Store being their primary source of revenue?
The App Store is in no way Apple’s primary source of revenue.
Apple also makes healthy margins on its hardware products.
But if you read their actual financial reports they have never indicated in any way that their hardware is a loss leader. They disclose this information publicly since they are publicly traded. Yes, the services revenue is higher than Macs and iPads combined and is at a higher profit margin, but hardware also makes a lot of money.
Apple’s only structural advantage should be their custom silicon, but I don’t think that’s a cost advantage as much as it’s a performance and battery life advantage. Apple is still buying huge dies from TSMC and designing them custom themselves which is not cheap. Lenovo shares the cost of designing an Intel, AMD, or Qualcomm chip with dozens of OEMs. Same deal with software: I wouldn’t be surprised if macOS costs more per unit for Apple than Windows costs for Lenovo considering all the employees Apple hires directly to develop it.
Apple in theory should be paying a pretty similar amount of money to make the rest of their systems. They don’t make camera sensors, displays, keyboards, DRAM chips, or anything else themselves.
Do they have anything like the same volume? Lenovo’s annual revenue is about half of Apple’s annual profit.
They don’t have the same profit margins but they are the #1 volume PC manufacturer in the world. They also own the Motorola smartphone business.
Apple is #4 in PC volume but they certainly make up for it with their smartphone volume.
And of course, they have a lot of service revenue to pad the balance sheet.
I'm not even looking at Lenovo's profits. I'm comparing their revenue to Apple's profit just to emphasize the difference in scale.
By the numbers, Apple is a smartphone business that has a casual side hobby of also being the #4 PC maker. Their PC sales are ~3x less than Lenovo's, but their smartphone sales are 10x their PC sales. There's plenty of commonality so the massive smartphone business surely helps with supply on the computer side of things as well.
Apple prioritizes price stability over price competitiveness. They will happily charge formerly eye-watering prices for extra RAM and their customers will less happily pay them. On the other hand, Apple rarely change their prices after release except in cases of extreme currency devaluation. They simply raise the price when the new model comes out.
They do this for their own reasons but it's helping them in this crisis. They can simply accept lower margins in the short term, in the knowledge that in the long term these price fluctuations even out.
From the perspective of the producers Apple are a consistent purchaser with deep pockets. AI companies may be willing to pay more for RAM in the short term, but Apple is a safer customer. The current AI bubble may or may not burst, but people will keep buying iPhones regardless. The producers do not want to freeze Apple out because Apple is their hedge against the bubble bursting.
Lenovo may not be a low volume purchaser but they are not at Apple's scale nor are Lenovo's customers willing to pay the premium that Apple's customers are.
I don’t think we’ve seen the lower margins in Apple’s financial reports.
Also, their computers have been getting more storage/RAM competitive as time has gone on. Literally just by time passing and prices staying the same.
Lenovo is beyond Apple’s scale when it comes to PC sales. They are #1 in volume. Apple is #4. Apple sells more iPhones but Lenovo does also own Motorola which is not nothing. We can also look at Samsung: a wildly high volume company who has their own production lines of major components like RAM and displays but they still sell their 2026 laptops at eye watering price increases.
Apple literally buys displays from Samsung.
Lenovo is beyond Apple’s scale, sure, but Apple has relatively few product lines. I imagine that makes it so the few parts they end up doing they have massive volume on.
Apple is also slightly decreasing their margins to maintain price. They can easily do this as their margins are 10x to 20x most of the industry.
Is that showing up in their financial disclosures?
And then Google is moving at full speed to lock-up the whole Android experience (bootloaders, OS, app store, etc.) so that even tech-savvy consumers are forced to get new, crappier devices when the old ones start slowing down. Enshittification at its highest level
Wait until Shrinkflation meets AIflation, where most services once mediated by humans are taken over by dumb, error-prone, allucinating AI, with no possibility of recourse.
> , allucinating AI
Oh, the irony