Apple's 'iPhone 7 Plus' predicted to face supply constraints due to new dual-lens camera

Posted:
in iPhone edited August 2016
By introducing an entirely new dual-lens camera system in the larger 5.5-inch variant of this year's iPhone upgrade, Apple could struggle with demand for the so-called "iPhone 7 Plus" at launch this fall, one analyst believes.




Amit Daryanani of RBC Capital Markets issued a note to investors this week, a copy of which was provided to AppleInsider, discussing features widely rumored for Apple's upcoming "iPhone 7" series. Thanks to growing demand for larger "phablet" screens, he predicts that the "iPhone 7 Plus" will account for one-third of production at launch.

Since the introduction of the 5.5-inch form factor with the iPhone 6 Plus, the larger phone has sported a superior camera than its smaller sibling. According to rumors and leaks ahead of the product's launch, the "iPhone 7 Plus" looks to continue that trend.

Daryanani believes this year's "Plus" model will feature a dual-lens camera capable of producing DSLR-like image quality. But he also believes the dual-lens camera will be the culprit in limiting availability at launch, with suppliers expected to struggle to keep up with demand at launch.

While there are other dual-lens smartphone cameras on the market, Apple's implementation is expected to be a proprietary method based on technology acquired from LinX back in 2015.




Supply constraints associated with new technology in Apple products are not new --?availability of the Apple Watch was limited for months after it launched in the spring of 2015. Even this year, Apple has struggled to match demand for its entry-level iPhone SE, as the company misjudged how popular the handset would be.

Beyond the dual-lens camera, Daryanani's "iPhone 7" predictions echo much of what has been discussed about the upcoming model. He expects it to include an upgraded "A10" processor manufactured by TSMC, improved water resistance, plus faster LTE.

Daryanani also believes the "iPhone 7" will ship with a minimum of 32 gigabytes of storage, rather than the current 16 gigabytes. In addition, he also sees the handset including 3 gigabytes of DRAM on the "Plus" model, and possibly even the 4.7-inch base model.

Also in line with established rumors, he believes the "iPhone 7" will shed its 3.5-millimeter headphone jack.

Looking forward, Daryanani does believe that ever-increasing replacement cycles in the smartphone market will lead to a dip in sales for the calendar year. Whereas the replacement cycle averaged 27 months in 2015, he expects it will extend to 29 months in 2016, and increase even further to 31 months through 2017.

In his view, these longer upgrade cycles could lead to a 9 percent year-over-year drop in sales to an estimated 210 million iPhones in 2016.

Leaked parts and consensus suggest the chassis of the "iPhone 7" will look largely the same as its predecessors. That has led many on Wall Street, including Daryanani, to predict that this year's model will not match the pent-up demand Apple saw for the iPhone 6 series.

Still, RBC Capital Markets has maintained an "outperform" rating for Apple's stock, with a target price of $115 a share. Estimates for the September quarter are $46.9 billion in revenue and earnings of $1.66 per share, which are slightly ahead of Wall Street consensus.

Rumors have suggested preorders for the "iPhone 7" will begin on Sept. 9, with the product making its way into the hands of consumers later in the month.
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Comments

  • Reply 1 of 38
    saltyzipsaltyzip Posts: 188member
    Another new iPhone on the horizon, and surprise surprise there will be supply constraints, what a load of all tripe. Scam stories to increase sales on day 1 to push the shares up and line bankers pockets. It's just glorified gambling.
    jfc1138ericthehalfbeegatorguyration alcalijay-tRayz2016
  • Reply 2 of 38
    schlackschlack Posts: 677member
    WRT to the upgrade cycle, my iPhone 6 is nearly 2 yrs old and I have absolutely zero interest in upgrading this September. This is the first time I can remember not being anxiously awaiting the new model iPhone. Upgrade cycles are definitely extending. At this point the only thing I can think of that would motivate me to upgrade would be better battery life or massively better camera performance.
  • Reply 3 of 38
    Rumored shortages of camera components for a not-yet-introduced iPhone may or may not result in the device being backordered, which could limit unit sales figures below levels not yet predicted by analysts. Those (rumored) backorders would be filled a month later, so the two-quarter impact on Apple's financial results would be about zero.
    mike1chiaai46ration alcaliDeelronjay-tRayz2016
  • Reply 4 of 38
    kevin keekevin kee Posts: 936member
    The upgrade  cycle prediction is false. I am definitely getting a new iPhone after 2 years since iPhone 6, as many people I know personally. The pent up demand for iPhone 7 can't be higher.
    edited August 2016 latifbpration al
  • Reply 5 of 38
    latifbplatifbp Posts: 544member
    schlack said:
    WRT to the upgrade cycle, my iPhone 6 is nearly 2 yrs old and I have absolutely zero interest in upgrading this September. This is the first time I can remember not being anxiously awaiting the new model iPhone. Upgrade cycles are definitely extending. At this point the only thing I can think of that would motivate me to upgrade would be better battery life or massively better camera performance.
    You must not use your iPhone very heavily. The upgrade to 2GB of RAM with the 6s is worth the cost alone. 
  • Reply 6 of 38
    latifbplatifbp Posts: 544member
    schlack said:
    WRT to the upgrade cycle, my iPhone 6 is nearly 2 yrs old and I have absolutely zero interest in upgrading this September. This is the first time I can remember not being anxiously awaiting the new model iPhone. Upgrade cycles are definitely extending. At this point the only thing I can think of that would motivate me to upgrade would be better battery life or massively better camera performance.
    You must not use your iPhone very heavily. The upgrade to 2GB of RAM with the 6s is worth the cost alone. 
  • Reply 7 of 38
    irnchrizirnchriz Posts: 1,571member
    Its the Annual Supply Constrained Rumour!

    camera
    manufacturing issues
    lcd supply

    blah blah blah

    and every year I pre-order and get it day 1, what a load of pish this is just to manipulate demand and market values.
    gatorguychiafastasleepration alcaliDeelron
  • Reply 8 of 38
    latifbplatifbp Posts: 544member
    schlack said:
    WRT to the upgrade cycle, my iPhone 6 is nearly 2 yrs old and I have absolutely zero interest in upgrading this September. This is the first time I can remember not being anxiously awaiting the new model iPhone. Upgrade cycles are definitely extending. At this point the only thing I can think of that would motivate me to upgrade would be better battery life or massively better camera performance.
    You must not use your iPhone very heavily. The upgrade to 2GB of RAM with the 6s is worth the cost alone. 
  • Reply 9 of 38
    How exactly is a dual-lens camera module suppose to produce DSLR quality images? What's the tech doing to provide a superior final image over a single lens setup?
    edited August 2016 baconstangzoetmb
  • Reply 10 of 38
    Did a little research. Here's my findings related to the advantages of a dual-lens setup:

    First, a dual-lens setup could feature two lenses with two different focal lengths. One lens is wide-angle, while the other could be 3x zoom. This means you can switch lenses to magnify more distant subjects without resorting to digital zoom. The setup could also deliver smooth zooms, for example during video recording, by employing a mix of digital zoom and lens-switching.

    The second benefit to using two parallel lenses, each with its own sensor, is improved low-light performance. Software works in real-time to match each pixel from one lens with the corresponding pixel from the other lens, and it uses scene analysis to detect which pixel is likely to be closer to the truth. As a result, noise is reduced and we end up with a cleaner picture.

    The third and final advantage is having two lenses enables a degree of depth analysis. Depth analysis allows for extra control over images, such automatically blurring out of backgrounds in portrait shots, quicker autofocus and augmented reality.
    ai46brucemcpscooter63caliDeelronbestkeptsecretred oak
  • Reply 11 of 38
    schlack said:
    WRT to the upgrade cycle, my iPhone 6 is nearly 2 yrs old and I have absolutely zero interest in upgrading this September. This is the first time I can remember not being anxiously awaiting the new model iPhone. Upgrade cycles are definitely extending. At this point the only thing I can think of that would motivate me to upgrade would be better battery life or massively better camera performance.
    I'm upgrading because my 6 is starting to get a little wonky. Already had to have the battery replaced, now there's a yellowish tint to the top of the display and the earpiece is starting to crap out. Speedwise it's fine (though 2GB RAM would have been welcome) but entropy's still at play. I'm not one to abuse my electronics, so I'm not sure what happened with this one. 

    Also, doesn't the Plus typically represent about 1/3rd of sales? 
    edited August 2016 repressthis
  • Reply 12 of 38
    netroxnetrox Posts: 693member
    I am definitely upgrading my 6 to 7 for two major reasons: higher resolution selfie camera and quicker access to common tasks with 3D Touch. 


    repressthispatchythepirate
  • Reply 13 of 38
    How exactly is a dual-lens camera module suppose to product DSLR quality images? What's the tech doing to provide a superior final image over a single lens setup?
    Is it going to provide zoom without pixel loss?
    Will it match APS-C for low light performance?
    I'm sure with image processing it will be an improvement, but DSLR quality?
    Also 3x zoom is nothing to write home about.
    edited August 2016 repressthis
  • Reply 14 of 38
    lmagoolmagoo Posts: 48member
    Hell I buy an iPhone for the phone not the camera....I don't give a damn what the camera does....I just wish the smaller phone would also get the goodies the + gets (i know there is probably no room)...I'll be damned to carry a Phablet...If I want a bigger screen I'll just grab my iPad. If I want a good photo I'll grab my real camera...
    baconstang
  • Reply 15 of 38
    Check your calendars, it's iPhone launch season.  Ergo the time has come for us to see articles proclaiming: iPhone sales suffer due to supply constraints, Apple can't manage inventories, Apple fails to gauge demand, new iPhone is a failure, Android outsells iPhone, Apple is doomed, Tim Cook should be replaced, ad nauseum.

    Funny thing though, is that 3 months after all the negative headlines, Apple surprises to the upside and the media's tune changes direction ,for a couple of weeks anyway, before the negativity starts all over again.

    These reports, coming from ES are all part of a plan to keep retail investors from buying before WS has finished loading up on AAPL.  Then when theirs and their clients coffers are full WS is shouting from the rooftops to buy.  Of course, at that time they just happen to be the sellers.

    If you own AAPL forget that you do.  No matter what you paid for it, through the thick and the thin, average 5 year return on AAPL exceeds 300% going back 10 years.  While you are selling, the institutions are buying.
    baconstangai46ration alpscooter63nolamacguybadmonk
  • Reply 16 of 38
    These people really make me sick. One will say demand for iPhone 7 is low so Apple isn't going to sell many of them. Now another says Apple won't even meet the numbers of low demand due to component shortages. How can these people know what problems Apple is going to have when they don't even know for sure what features are going to be on the iPhone 7? Why is it that other smartphone vendors don't seem to have all these problems that Apple is always said to have? Look at all those smartphones Samsung puts out and they're never said to have all these component supply problems.

     If there are supply constraints then what is Tim Cook doing because he was supposedly the master of keeping the trains running on time at Apple. Apple would seem to have so much time to get everything in order before the new iPhones are released. Wall Street isn't happy because Apple doesn't sell enough iPhones so Apple will never manage to sell many more if they don't have any control over component supply numbers. Apple always seems to be sitting on a sharp rock as far as analysts are concerned.
    edited August 2016 ration allkrupp
  • Reply 17 of 38
    williamhwilliamh Posts: 623member
    And breaking "news" from the future:  the iPhone 8 will be delayed and will face parts supply constraints despite the fact that it contains no new features.
    baconstangharry wildfreethinkingnolamacguythepixeldoc
  • Reply 18 of 38
    cnocbuicnocbui Posts: 3,613member
    Did a little research. Here's my findings related to the advantages of a dual-lens setup:

    First, a dual-lens setup could feature two lenses with two different focal lengths. One lens is wide-angle, while the other could be 3x zoom. This means you can switch lenses to magnify more distant subjects without resorting to digital zoom. The setup could also deliver smooth zooms, for example during video recording, by employing a mix of digital zoom and lens-switching.

    The second benefit to using two parallel lenses, each with its own sensor, is improved low-light performance. Software works in real-time to match each pixel from one lens with the corresponding pixel from the other lens, and it uses scene analysis to detect which pixel is likely to be closer to the truth. As a result, noise is reduced and we end up with a cleaner picture.

    The third and final advantage is having two lenses enables a degree of depth analysis. Depth analysis allows for extra control over images, such automatically blurring out of backgrounds in portrait shots, quicker autofocus and augmented reality.
    Two lenses with different focal lengths are not going to allow you to compare pixels to reduce noise because each pixel will be lit by an entirely different part of the scene - the images won't correspond.

    As for a dual lens camera delivering DSLR rivaling image quality - bunkum.
    edited August 2016 baconstangration algatorguy
  • Reply 19 of 38
    Cause and effect:  new iPhone, new rumors of supply constraints. 
    gregg thurman
  • Reply 20 of 38
    lkrupplkrupp Posts: 6,530member
    Happens every year. New iPhone, rumors of "supply constraints." Anything to manipulate the stock price. Issue a false "note to investors" to push down the price. Analysts are lower than whale shit.
    gregg thurman
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