iPhone 7 Hands-On: A Better iPhone, but the Two-Year Leap Is Over

The iPhone is now a business like the Mac — it gets its annual update, but stop expecting a big change every two years.

Since 2008, Apple has kept to a rhythm of one major update every two years. The iPhone 4 brought a new shape; the 4s improved what was inside.

Over those eight years, users got used to that rhythm. Word had been out for months that the iPhone 7 would not change much, and it still drew far more attention before launch than the iPhone 6s did.

But at the keynote in the small hours of this morning, Apple did not deliver that two-year leap.

Picking up an iPhone 7 feels like the last two years of MacBook Pro upgrades: you know it is better than the model before it, but you cannot see it at a glance.

Whatever the color, the front of the iPhone 7 barely differs from the 6 and the 6s.

A 4.7- or 5.5-inch screen fills most of it, bordered by a body in plain black or plain white.

A thin slit above the screen hides the speaker; below sits the familiar round Home button. Unless you look closely, you cannot tell which phone is the iPhone 7.

They do not feel different in the hand, either. If you are used to a 6 or a 6s, this will not feel like a new phone.

Everything you can see has changed on the back

The obvious changes are on the back — the side other people see while you use the phone.

In the hands-on area after the keynote, Apple put the version with the biggest visual change, Jet Black, right at the entrance. Under the lights, its back is almost a mirror.

It is also the model on the iPhone 7 page you land on at Apple's website.

The iPhone 7 reworks the rear antenna design people complained about on the 6 and 6s: on the white phones the antenna bands now run along the edges. But the two new black finishes use bands much closer in color to the body. On a Jet Black iPhone 7 you can hardly make the antennas out; the whole back looks like one piece.

Jet Black drew the most attention, too. It had the longest queue in the hands-on area.

Its flaw is fingerprints. A finger touches it and leaves a mark. Apple's staff wiped it down with a cloth after every two photos.

The other new black, a matte one, uses the same finish as the remaining colors and does not show prints.

Apart from the two new colors, the other change you can see at once is the camera on the back, bigger again.

Apple spent most of the iPhone section of the keynote on the camera, and on paper it really is much better. The 4.7-inch iPhone 7 now gets optical image stabilization as well, and both lenses move to f/1.8 — a wide aperture for a phone. The 5.5-inch iPhone 7 Plus simply uses two cameras to get optical zoom, so you can magnify something far away without losing detail.

Apple's staff would not let anyone export photos taken with the iPhone 7. Judging from the shots already stored on the phones, the new hardware makes a visible difference.

As with the "Shot on iPhone" ads you see on the street, the samples Apple prepares are about the best the hardware can do; they do not mean your everyday pictures will look like that. We will know next week, when the iPhone 7 ships.

Better photos come at a cost: the double camera is also harder to ignore on the back. If the bulging camera on the 6 and 6s already bothered you, the 7 Plus will bother you more.

The new iPhone has changed in other ways — you just may not care

The front that looks unchanged is in fact where several of the new features hide.

The Home button, for one, is no longer a button. It is a dished piece of glass, and a vibration imitates the click when you press it.

Apple also added a speaker at the top, so the phone plays stereo sound — better for video and games.

Both features show how much engineering Apple put into the iPhone 7.

Press the virtual button on a Samsung Galaxy S7 Edge and you feel the phone vibrate. Press the Home button on an iPhone 7 and you feel a key spring back.

The speakers are the same story. Other dual-speaker phones, such as the Sony Z5 and the Moto Nexus 6, put two openings on the front, which spoils the look.

On the iPhone 7 the new speaker hides inside the earpiece at the top of the screen. You notice it only when sound comes out.

Stereo requires both sides to sound the same. Because the two openings are shaped differently, Apple had to retune the drivers inside and the software as well. Against the design of nearly every Android phone, Apple took the harder route that looks better.

The trouble is that none of these small changes may be enough to make anyone buy a new phone. The iPhone 6s, launched at this time last year, also changed plenty: a stronger body alloy, 3D Touch pressure sensing in the screen, a large jump in processor speed.

And the 6s sold far fewer units than the iPhone 6 before it.

Dropping the headphone jack will hurt the accessory business, but it will not sell iPhones

The most argued-over decision on the iPhone 7 is the missing headphone jack. Phil Schiller, Apple's marketing chief, called it an act of courage: take out the redundant 3.5mm jack and leave more room inside for other parts.

Apple has gone first in killing old technology on computers before. The iMac dropped the floppy drive; the MacBook Air dropped the optical drive and the Ethernet port.

But every one of those cuts brought an obvious gain. When the 2010 MacBook Air lost Ethernet and the 2012 MacBook Pro lost the optical drive, both got much thinner. That was the reason to buy one.

This time the gain is missing. The iPhone 7 is not even a millimeter thinner. All the user sees is subtraction.

To solve the problem of listening while charging, Apple made AirPods for the new iPhone. They are well designed: the case charges them, opening the case pops a pairing prompt onto the iPhone at once, and putting them in your ears switches the audio over from the speaker automatically.

Every detail makes you think this is how Bluetooth earphones ought to work.

The iPhone 7 may well push Bluetooth audio makers to build more products and more features — all of which pull against the 3.5mm jack.

Users may decide the jack does not matter much either way. They will not change phones over it.

The iPhone has finally joined the laptop's upgrade cycle

From the iPhone 3G in 2008 onward, every two years brought a redesign worth waiting for:

• iPhone 3G: a polycarbonate shell and 3G, so you could use internet services away from WiFi;
• iPhone 4: glass on both sides, the world's first Retina-resolution display;
• iPhone 5: a single-piece metal body, much thinner and lighter than the 4s;
• iPhone 6: a big screen.

The iPhone 7 brings nothing of the sort. Maybe Apple has let go of the two-year cycle; maybe the supply chain was not ready.

The next iPhone is said to use a curved OLED display, like the one Samsung uses on the S7 Edge.

The iPhone needs 200 million screens a year, and only two companies, LG and Samsung, can make them at that scale.

Samsung Display already supplies the OLED screens for the Apple Watch. But judging by how many Edge panels it can make, it would struggle to supply Apple in quantity this year.

Even if a curved screen changes the shape of the iPhone in 2017, no one should expect that to happen every two years.

Most new technology that reaches a smartphone announces itself long in advance. Apple bought a fingerprint-sensor chip company more than a year before it launched the 5s.

Samsung's curved display took more than two years to become common. It first appeared on the Edge, a niche product in 2014; the S6 Edge the following year raised output, and even then Samsung could not guarantee that two S6 Edge screens curved the same way.

Nothing on the horizon looks likely to change the smartphone within two years.

Apple has given up the two-year redesign, and it is unlikely to take it up again.

The iPhone has joined the Mac's upgrade cycle: hardware refreshed on schedule each year — a faster, more efficient processor, a brighter screen, a better camera. They make the iPhone better. They do not make anyone want a new one.

As with the Mac, a new technology may take three years or longer to ripen.

The technical ceiling has arrived just as the market hit its own. This year the smartphone market stopped growing.

The iPhone's last great surge came in 2014, when Apple had both the big-screen iPhone 6 and China Mobile's push into 4G.

There is no next market about to open up. Nearly everyone who can use a smartphone already does. What is left is taking Android users, waiting for poor and war-torn places to grow rich, or waiting for iPhone owners to replace their phones.

Sales have fallen for three quarters running, which suggests none of the three will keep Apple selling more iPhones year after year.

On an earlier earnings call, someone asked what would come of the Apple car. Cook answered: "Do you remember when you were a kid? Christmas was exciting because you didn't know what was waiting for you downstairs. Well, Christmas is going to go on for a while."

We do not know what will come of the car. But now that the smartphone runs on a laptop's update cycle, a new iPhone no longer promises anything like a Christmas present. More and more people will wait until the phone slows down or breaks.

The research firm CIRP counts nearly half of users carrying an iPhone more than two years old, and the replacement rate has been slowing since 2015.

No immediate threat faces the iPhone. Besides making the iPhone 7's CPU itself, as usual, Apple designed its image signal processor (which improves photographs), the connection chip in the AirPods case (open it and it pairs with the iPhone, which ordinary Bluetooth devices cannot do), and the Apple Watch's processor.

Once a manufacturer has to build its own chips to add features, catching up gets hard for a new company, or for one that has not spent years on semiconductor design. The three best-selling phone makers in the world — Samsung, Apple and Huawei — all design their own silicon.

In 1997, after Steve Jobs returned to Apple, he said the personal-computer war was over and Microsoft had won. Apple then moved its center of gravity off the Mac, spent the money the Mac made on the iPod, and after that built the iPhone, putting the mobile internet in everyone's pocket.

Now the smartphone war is over as well, and both Google and Apple won: Google has 2 billion Android users, China included; Apple has more than 600 million. One of them preinstalls its internet services on the phones of well over a billion people; the other sells hardware and takes nine-tenths of the profit in the entire phone industry.

But that market has stopped growing too, and has settled into something close to the laptop's upgrade pattern.

Apple's future depends on whether the money the iPhone makes can become, in some new market, the Christmas present Cook talked about.

For where Cook's new "Christmas presents" stand, see our series:

Apple can build the iPhone. Why can it never get internet services right?

How serious is Apple about cars? We went to look at its secretive campus

A new Apple Watch OS: Apple starts the watch over and stops talking about fashion