The benefits, on the other hand, are surprisingly few. Removing the headphone jack frees up a small amount of space inside the iPhone. And while it’s true that audio over Lightning can produce a higher sound quality, that’s been an option on iPhones for years — now Apple is just forcing everyone into choosing it. There’s no actual improvement to sound in the iPhone 7.
While it’s tough to make the case that dropping the headphone jack is better for consumers, the benefits for Apple are much easier to see. The iPhone 7 will be bought by tens of millions of people during the next few months alone, and its lack of a headphone jack is going to make many of them consider buying Lightning or Bluetooth headphones. Apple profits from both.
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Any company that wants to make a pair of Lightning headphones has to go through Apple’s licensing program. Though its fees are kept a secret, past reports have indicated that Apple charges a flat fee for every device sold using one of its connectors. So a bump in the likely low popularity of Lightning headphones is a win for Apple, since it’s getting a cut no matter who sells them. Apple did not respond to a request for comment on its licensing fees.
And that’s just Lightning. More likely is that the lack of a headphone jack on the iPhone — and increasingly, on Android phones as well — will lead to an uptick in sales of Bluetooth headphones. And it just so happens that Apple owns the number one Bluetooth headphone company, Beats.
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Beats brings in more revenue from Bluetooth headphones than LG, Bose, or Jaybird, according to NPD figures released in July. In terms of unit sales, it controls over a quarter of the Bluetooth headphone market.
Bluetooth headphones are also disproportionately profitable among headphones. NPD has them accounting for 54 percent of all dollars spent in the market, despite representing only 17 percent of units sold in the US. These headphones sell at high prices with high margins, and Apple’s company is making the best of it so far.
