The Apple iPhone 6s lineup. Image source: Apple. 

Chinese smartphone vendor Xiaomi announced a new flagship smartphone known as the Mi5 at Mobile World Congress late last month. The device, like many of Xiaomi's flagship devices, is notable because it packs a lot of top-tier hardware specifications in a relatively low-cost package. 

The purpose of this article isn't to talk about the Mi5 per se. Rather, I believe that the Mi5 might offer an important clue as to what display technology we may see in Apple's (NASDAQ:AAPL) upcoming iPhone 7.

Could the Mi5 be the first implementation of JDI's Pixel Eyes 2?
In earlier columns, I noted that Apple could very well be planning to use second-generation "Pixel Eyes" in-cell touch displays from Japan Display, which went into mass production at the end of 2015. These new displays, per the Japan-based display manufacturer, offer a number of important advantages over first-generation Pixel Eyes displays, such as improved contrast ratio, narrower display borders, reduced thickness, and so on.

According to Xiaomi (via AnandTech), the Mi5's display offers up a number of interesting characteristics. The display itself apparently sports a high contrast ratio of 1400:1, extremely thin side bezels, quite high brightness, the ability to change contrast ratio on a per-pixel basis in real time, and a wide color gamut (95% of NTSC, well beyond the typical 100% sRGB coverage).

I would not be surprised at all if the Mi5 were packing a second-generation Pixel Eyes display from Japan Display given the reported characteristics.

If so, expect big improvements in the iPhone 7's LCD
To the best of my knowledge, Apple does not use "off-the-shelf" displays; rather, it would appear that Apple has a fairly large team of experts that works closely with display manufacturers to build displays exclusively for Apple. 

That said, I do believe that the interesting features that Xiaomi introduced with the Mi5's display represent a baseline for what to expect from the iPhone 7's display. In particular, look for brightness to go up, the color gamut to be widened significantly, and for contrast ratio to move upward (Apple's current displays are already where the Mi5's display is).

I also fully expect that Apple will implement a real-time contrast ratio adjustment scheme in the iPhone 7 as Xiaomi has with the Mi5.

The new display could be quite eye-catching
One of the problems that I believe Apple is facing during the iPhone 6s cycle is that many iPhone 6 buyers (and iPhone users who held off on buying a 6/6 Plus) didn't see an immediate and obvious difference between the "old" iPhone 6 and the new iPhone 6s models.

The industrial designs being similar didn't help, nor did the fact that the display panels seem to be unchanged year over year.

With the enhancements to the display discussed above, coupled with a move to higher-resolution (and thus sharper) displays on both the 7 and 7 Plus/Pro, the generation-on-generation improvements should be immediately obvious to anybody who tries the new devices in a retail store. 

That, coupled with an all-new industrial design, a much-improved camera subsystem, and other as-of-year unknown goodies, could make the iPhone 7 the product that puts iPhone back on a growth path.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.