The iPhone X's most important feature for 2017 is its front-facing TrueDepth camera system, which enables a slew of new features like Apple's (NASDAQ:AAPL) new Face ID facial recognition system, as well as novelties like Animoji. There has been a constant flood of reports detailing potential production challenges associated with these TrueDepth modules.
One critical component of TrueDepth is the vertical-cavity surface-emitting laser (VCSEL) sensor, and suppliers have been trying to ramp up VCSEL production in recent months. Beyond component supply, contract manufacturers have been having difficulty assembling the actual modules.
Production appears to be improving, as the quoted shipping estimates on new orders placed through Apple's site aren't all that bad (currently five to six weeks). That's a long wait, but not out of line with prior years that have seen supply constraints. Despite potential improvements in production, Apple still may not opt to add an additional rear-facing TrueDepth camera to next year's iPhones.
Apple can wait
That prediction comes from KGI Securities analyst Ming-Chi Kuo (via 9to5Mac), who issued a research report yesterday on the topic. There has been some speculation that Apple may put a rear-facing TrueDepth camera on the 2018 flagship, since Apple's newest technologies often find their way across the company's lineup whenever possible (with only a few notable exceptions).
Apple is enjoying a significant technological lead over the Android competition and has locked down the bulk of the VCSEL industry's supply in the near term, so the company may not feel particularly pressured to expand TrueDepth's presence, in Kuo's view. The iPhone maker may also be interested in keeping costs down, especially as the iPhone X's $999 price tag is already creating consternation among some consumers.
It's worth noting that Kuo recently predicted that the iPad Pro would get TrueDepth in 2018 in a separate research note to investors, which could help further differentiate the professional-oriented tablet from the consumer-oriented version.
Apple should still eventually add a rear-facing TrueDepth camera
Kuo is likely correct that there's no rush to add a rear-facing TrueDepth camera, but Apple should still eventually add such a module to the iPhone eventually. Perhaps the company is waiting for 3D sensing technology to evolve further in terms of cost and performance.
A more powerful, rear-facing TrueDepth camera could have huge implications for Apple's augmented reality (AR) ambitions, potentially allowing iPhones to create detailed 3D environmental maps similar to what Alphabet subsidiary Google's Project Tango aspires to do. To be clear, Apple's ARKit is already quite impressive with what it can do with the existing sensors using a technique called visual-inertial odometry, but it would be dramatically more powerful if it had access to more specialized sensors that are designed for 3D sensing.
It might not happen next year, but Apple will almost certainly add rear-facing TrueDepth cameras eventually.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Evan Niu, CFA owns shares of Apple. The Motley Fool owns shares of and recommends GOOG, GOOGL, and Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.