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Will Apple Inc.'s iPhone 7s and 7s Plus Fail in the Marketplace?

On social media, I had an interesting discussion with a friend of mine who goes by the handle of "AAPL Tree" about the iPhone models that Apple (NASDAQ: AAPL) is expected to launch this fall. 

I observed that typical smartphone buyers seem to care more about the aesthetics of a smartphone than they do about the innovative technologies inside them. AAPL Tree agreed and went on to say that it's this consumer obsession with aesthetics that makes him doubt that Apple will even bother releasing the rumored iPhone 7s and iPhone 7s Plus.

Image source: Apple.

Apple is rumored to be launching three phones this year: a totally redesigned iPhone with an OLED display and all sorts of other goodies packed in, as well as straightforward successors to the current iPhone 7 and iPhone 7 Plus models that mainly focus on technology upgrades while retaining similar form factors.

Later in the discussion, AAPL Tree argued that such iPhone 7s and 7s Plus models would be a "unit sales issue," if not a unit-sales "disaster."

Here's why I'm not inclined to agree.

People care about form factor, but...

I stand by my comment that people do care a lot about form factor, which is very likely the reason the iPhone 6s series of smartphones saw lower unit shipments than the iPhone 6 series, and why the iPhone 7 series hasn't done much to put the iPhone back on a robust growth path.

It's also why I think that the OLED iPhone really is the key to returning Apple's iPhone business to growth.

However, I think Apple can -- and potentially will -- bring enough compelling feature innovations to make the iPhone 7s and 7s Plus worthwhile products that will perform reasonably well in the marketplace.

For example, here's what I hope to see from the 7s and the 7s Plus:

  • A new Apple A11 Fusion chip.
  • ProMotion Displays (since Bloomberg reported that Apple was testing such displays for upcoming iPhone models; I was skeptical of this before).
  • True Tone displays.
  • Glass backs (as reported by KGI Securities' Ming-Chi Kuo).
  • Wireless charging (also reported by Kuo).
  • Improved camera subsystems relative to the ones found on the iPhone 7 and 7 Plus, respectively.
  • Faster wireless subsystems.

Even if Apple retains the same form factors as the iPhone 7 and iPhone 7 Plus for the upcoming iPhone 7s and iPhone 7s Plus, respectively, the list of enhancements should make the new phones substantially better than the iPhone 7 and 7 Plus, and they should offer a veritable world of difference relative to the 6s series and, even more-so, the 6-series devices.

If Apple prices these devices right, and if the company does a good job of educating customers about the benefits of these features -- some will be obvious to customers who try the phones, such as ProMotion displays -- then I don't think Apple will have a "sales disaster" on its hands.

But to be perfectly clear, I think the value proposition of going with the higher-end iPhone 8 with OLED display will be so great that those who can afford the iPhone 8 will go for the 8 rather than save some money to go with the 7s or 7s Plus.

And that's probably exactly what Apple wants.

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Ashraf Eassa has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool has a disclosure policy.