Apple takes iPhone to 7, Watch to 2, headphone jack to 0

iPhone 7 Plus now not just about bigger screen, but also about multiple cameras

Apple executives, including CEO Tim Cook, today rolled out the company's latest smartphones, the iPhone 7 and 7 Plus, as well as the company's next-generation smartwatch.

At the same venue used 12 months ago to launch the iPhone 6S -- San Francisco's century-old Bill Graham Civic Auditorium, a hall where the Apple II debuted in 1977 -- Apple kicked off a two-hour event that was lighter in new products than last year.

Apple didn't help itself by blowing much of the suspense that remained long before officials got to the iPhone 7 on stage: Someone tweeted details from the firm's official account before anyone mentioned them during the event. The too-early tweets, which touted the Sept. 16 on-sale date and other information, were quickly pulled, signaling a timing screw-up. Those tweets also inaccurately promised that pre-orders would open today.

"They were an unfortunate distraction and detraction from the main event," noted Jan Dawson, chief analyst at Jackdaw Research, in an email.

Watch, take 2

After the usual preliminaries -- Apple likes to open major events with a statistic-heavy status update on multiple fronts -- Cook ceded the stage to Jeff Williams, Apple's chief operating officer, who introduced a refresh of the Apple Watch. "We are going to keep pushing Watch forward," said Williams of what the firm called Apple Watch Series 2.

"It has been completely re-engineered," Williams boasted, adding that it was "swim-proof," or water resistant to 50 meters. Other additions and improvements ranged from built-in GPS to an upgraded system-in-a-package (SiP) that includes a dual-core processor that Apple claimed was 50% faster, and a graphics processor with twice the performance of the original.

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Apple Watch Series 2

The Series 2 comes in the familiar aluminum and stainless steel, but also in a new ceramic material that Williams said was much stronger than the stainless. The new models will go on sale Sept. 16 starting at $369, but Apple is retaining the original line -- Series 1, upgraded with the S2 SiP -- at prices beginning at $269.

Apple did not mention the second-generation smartwatch battery lifespan during the event -- an omission some noted because of the implied demands of the beefier processors and brighter display -- but claimed the same 18 hours as the Series 1 on its website.

Those first-gen lower prices were more important than the next-gen specs, contended Carolina Milanesi, an analyst with Creative Strategies. By swapping in the S2 on the original models and lowering prices, she argued, Apple was "going to hurt a lot of its competitors" in the smartwatch space. "There are a lot of people sitting on the [smartwatch] fence, and this time Apple isn't giving just a price reduction but also a better experience," she added.

Patrick Moorhead, principal analyst at Moor Insights & Strategy, concurred. Series 2's new touts -- GPS, water resistance and a brighter screen -- and the original Series 1 getting the S2 SiP, he said, combined to broaden the line's appeal. "[Apple has] moved Watch from early adopters to early majority," Moorhead said, perhaps coining a new phrase.

Lucky 7

Cook reclaimed the stage to introduce the year's iPhones. "It's the best iPhone that we have ever created," Cook said, repeating a line that surfaces annually at the Cupertino, Calif. company's launches.

The new smartphones, tagged as the iPhone 7 and the iPhone 7 Plus -- following the usual even-year monikers -- are new, head of marketing Philip Schiller maintained, even though externally they look almost identical to last year's models.

"The pundits were wrong. iPhone 7 and 7 Plus was a major upgrade, not a minor one," agreed Patrick Moorhead, principal analyst at Moor Insights & Strategy, referring to expectations that Apple would retain a look for an unprecedented three years. "They changed every single thing about it except for the shape. They did more than I expected, frankly."

Schiller stepped through 10 new features of the phones, most of which had been at least hinted at, if not spelled out in excruciating detail, by rumormongers and leakers. Among Schiller's picks: A reworked Home button, stereo speakers, and a water-resistant case.

The larger 5.5-in. iPhone 7 Plus gets a new dual-camera set, both 12-megapixel single-lens models: One is identical to the enhanced camera in the iPhone 7, the other offers a telephoto lens. The latter relies on optical zoom from 1x to 2x, but from there to 10x, digital zoom -- software, in other words -- takes over.

Cameras in both the iPhone 7 and iPhone 7 Plus sport optical image stabilization, enhanced flash and a larger aperture, the latter which should significantly improve low-light photography.

Analysts focused on the cameras as they gave off-the-cuff evaluations of the new iPhones.

"Schiller made a point of first talking up the iPhone 7 camera and its improvements before moving on to the iPhone 7 Plus and its dual camera," said Dawson, highlighting the order, with the likely-much-better-selling 7 at the forefront.

Milanesi targeted the new differentiation Apple has embraced. Where the Plus was previously only about a larger screen, now it's about that and a better camera. "What the Plus is, is a 'Pro' model, even though Apple doesn't call it that," said Milanesi. "It's not just its size, but also the camera, which is a big deal."

a10 fusion Apple

Apple's new iPhones are powered by the 64-bit, quad-core A10 Fusion SoC (system-on-a-chip), billed as a "rocket ship" by Schiller. Fusion is 40% faster than last year's silicon, with a graphics processor 50% faster and with task-dependent switching between two performance-oriented cores and two energy-efficient cores.

As expected, Apple dropped the jack for corded headphones, going with the existing Lightning port -- used also for charging -- for connected audio, including the iconic bundled ear buds. Apple will include an adaptor with each iPhone so that those with corded headphones can continue to use their gear.

Never to leave a revenue opportunity on the table, Apple also trumpeted wireless audio, backed by new silicon, as it introduced AirPods, its $159 wireless ear buds. They will compete with several new products from Apple-owned Beats, which also take advantage of the same silicon and processing software.

Apple priced the new iPhone 7 and 7 Plus starting at $649 and $769, respectively, but increased the minimum storage space to 32GB. Last year's iPhone 6S and 6S Plus, meanwhile, dropped in price to make room for the new models. Apple also retained the iPhone 5SE from earlier this year.

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Last year's iPhone 6S and 6S Plus dropped in price to make room for the new models.

"This event was a big test of Apple's ability to continue to tell a compelling story around its annual product upgrades, and early sales of the iPhone 7 will be a good indicator of whether it succeeded in weaving a narrative that people find compelling," said Dawson.

Preorders kick off Friday, Sept. 9, with sales starting on Friday, Sept. 16, as Apple returned to a more traditional schedule after departing from that last year. iOS 10, which will be pre-installed on the new phones but available for download on older models, will release Tuesday, Sept. 13.

Copyright © 2016 IDG Communications, Inc.

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