The AI memory shortage reached your phone bill, so T-Mobile will let you pay it off slower

The AI memory shortage has reached the phone-shop counter. T-Mobile is rolling out financing that lets customers walk out with a new handset for nothing down. It does this by spreading not just the device but its taxes and fees over three years. The reason its executives give is unusually blunt: chips are getting dearer, and phones with them.

The plan, EIP Flex 36, launches on Thursday. It rolls the phone, the taxes and the fees into 36 monthly payments, with nothing due at checkout. The pitch is that even “zero down” deals still make you hand over $100 or more in taxes and fees on the way out. T-Mobile says it is the only plan in wireless to fold those in.

Why phones cost more

The interesting part is the why, and T-Mobile does not hide it. Its executives blame the memory shortage. Chief executive Srini Gopalan told investors that memory-price increases are “resulting in higher prices for smartphones across the board,” a trend he expects to continue. His marketing chief, Andre Almeida, said taxes and fees have climbed with the phones, driven by demand for chips and memory.

That demand is the AI boom. The same scramble for memory that is filling data centres has pushed up the price of the chips inside everyday electronics. Apple has raised prices, AMD marked up graphics cards, and Fujifilm put up its cameras. Microsoft is even slimming Windows to fit machines with less RAM. Now the bill has landed at the carrier.

The catch

The offer is narrower than it sounds. The nothing-down price and the 0% interest apply only to “well-qualified customers.” The fine print puts the rate anywhere from 0% to 24%, depending on credit. Stretching payments to 36 months, up from 24, also ties customers to the carrier for longer.

It fits a wider pattern. Financing and leasing schemes have spread across the industry for the same reason: devices are getting too expensive to buy outright. T-Mobile also rebranded its unlimited plans as “2.0” versions, though the features and prices are unchanged. It is a formality to pair with the new financing, as CNET noted. It added student plans from $30 a month too.

T-Mobile is the second-biggest US carrier, and under Gopalan it is chasing Verizon for the top. Rivals are cutting prices as well, so a slicker way to pay is a competitive weapon.

But the subtext of the day is bigger than one promotion. The cost of the AI build-out is working its way down to what you pay for a phone, and T-Mobile’s answer is to let you pay for it more slowly.