This Apple Inc. (AAPL) Rumor Makes No Sense

For a company so obsessed with secrecy, it’s rather ironic that Apple Inc. (NASDAQ:AAPL) can’t surprise investors and consumers anymore thanks to the company’s omnipresent rumor mill. For instance, every aspect of the iPhone 5 was leaked in advance, and there were no surprises when the new flagship device was officially unveiled.

Over the past few months, details of the purported iPhone 5S have been steadily making their way to market. Investors are expecting the next model to include a fingerprint sensor for biometric security (and possible payments service). Following the same two-year design cycle, the body may remain the same, while internals like the processor and camera will get appropriate bumps.

The latest Apple Inc. (NASDAQ:AAPL) rumor is catching investors by surprise, but it also makes no sense.

More trouble than it’s worth
Weiphone is reporting that Apple will further increase the resolution of the iPhone 5S, doubling the total pixels from about 730,000 to approximately 1.5 million. The Chinese site also claims that Apple Inc. (NASDAQ:AAPL) will make the device’s bezel even slimmer, taking cues from the iPad Mini.

There are several reasons why cramming 1.5 million pixels in doesn’t pass the sniff test. Assuming that Apple sticks with a 4-inch display (it just added that size less than a year ago and the larger iPhone isn’t expected until next year), increasing the resolution would introduce another layer of fragmentation into iOS while app developers are still in the process of transitioning content to the iPhone 5’s taller display.

Here are some theoretical scaled resolutions for a 4-inch display.

Source: Apple and author’s calculations. Some figures rounded. PPI = pixels per inch.

Getting to 1.5 million pixels would require non-integer scaling to ensure backwards compatibility with existing apps, and the associated algorithms could put a drag on performance. Apple Inc. (NASDAQ:AAPL) uses extensive scaling in Retina MacBook Pros, and warns that using scaled resolutions affects performance for precisely this reason.