I am just going to come out and say it – the iPhone 5 is yet another incremental upgrade to the iPhone line of products. Yes, Apple deserves great credit for making smartphones ubiquitous – they have turned mobile devices into web-surfing gadgets and so much more. But this doesn’t mean that Apple is innovating as fast as it could be.

In fact, TMC writers have discussed with me in private that Apple may be purposely holding back on their phone upgrades to ensure people will keep buying new devices on a regular cycle.

So what is the missing feature? Simply making the phone wider. You may recall I said the iPhone 5 has the wrong form factor a week ago today. To answer such criticism, the company says they want the phone to fit in the hand. Since Apple has been famous for having a reality distortion field, at first you may be inclined to take this answer at face value. But if you do, I suggest you stay away from leatherglovesonline because they have something they call a glove sizing chart which seems to show that human beings actually have hands which are different sizes.

In fact the smallest hand for a woman is 6 inches and the largest for a man is 12 inches which means that hand sizes are vastly different, ranging in size by a full 100%. See chart below. This tells us that a blanket statement about a device fitting in the hand doesn’t actually make any sense – in fact we see from the wide range of hand sizes there is room for the company to widen the iPhone and fit in “most hands”. Moreover, there are few if any complaints about hand-fit from competing devices like the Samsung Galaxy S3.

Other than that, Apple has made all the right improvements – a better camera, faster processor, its a better gaming device due to superior color saturation, etc. Siri has been improved dramatically, iCloud is better integrated into the OS and you can even communicate on your social networks via speech. Finally, it is gorgeous – all glass and aluminum.

Oh yeah, and the new phone supports LTE which may mean Samsung has grounds to countersue the company into oblivion depending on the technology which is used and what the lawyers and courts decide. Perhaps Samsung’s patents will cancel out the other patents Apple holds meaning these companies will be forced to compete exclusively on innovation rather than on who was fastest to patent the latest feature or function.

The one factor which I have learned from years of covering and analyzing Apple devices is there is always more to these gadgets than immediately meets the eye. In other words, even if the company has a slower processor than the competition, web surfing and other features could be faster on iOS because the company spends so much time optimizing the user experience. So too with the iPhone 5 – even if users were expecting a wider screen, the combination of better camera, new OS, faster processor and LTE can make the iPhone 5 seem like a major upgrade over the iPhone 4S in actual use.

Other features include: 

• Siri can give you sports scores and team schedules as well as make reservations at restaurants for you
• The camera has a sapphire cover making it thinner and more durable
• The device can take panoramic photos which used to require a separate app like Pano
• There are 3D maps and turn-by-turn navigation to compete with Android
• Facebook is integrated into iOS6 which is standard on this new phone and compatible with 3GS and higher and iPad 2 and higher
• iOS6 also supports coupons, boarding passes, shared photo streams, reply to phone call with text message, VIP lists so you don’t’t miss important email messages and more
• The company says the new OS is coming soon
• Jony Ives says this product has the best fit and finish of any product the company has ever made – a huge deal if true
• This level of precision extends to manufacturing where crystalline diamonds are used to machine each product
• The variances of each device are now measured in microns due to a manufacturing process which the company calls extreme.
• The iPhone 5 is not only faster and manages battery better, it is 20% lighter
• The new screen is 4-inch diagonal with Retina display compared to a 3.5-inch screen on the 4S – both screens sport 326 ppi
• Virtually all radio standards are supported – now HSPA+, LTE and 5GHz WiFi
• The front camera now sports 1.2 MP pictures and video at 720p HD
• Video recording now has face recognition as well as photo within video capability
• Earphones are now rounder EarPods with a storage and travel case – they took three years to design – seriously?
• There is a new reversible Lightning connector which replaced the old 30-pin design
• Battery life is increased browsing for 10 hours on WiFi as opposed to 9 hours for the 4S.

In short we know many people will upgrade their iPhones regardless of features and I feel Apple should have gone the extra step to make the phone wider when they had the chance. I think this is a negative for customers who will have to go out and upgrade their cases, alarm clocks and other devices which no longer work with the iPhone 5. And if pressure forces the company to widen its phone form factor in the future, these same customers will have to go out and upgrade their accessories again.

But the flipside is the phone is faster, thinner, has better battery life and is slightly bigger. You could argue if the current iPhone was good enough for so many hundreds of millions, the new iPhone form factor will be even better. Still, I think there is plenty of room for Samsung and other manufacturers to pick off millions of customers who were hoping the iPhone 5 would not only have all of the features above but give them a larger screen as well.

Update 9/14/12: Buzzfeed has a funny rendition of the iPhone 10 which ties in nicely with this post. Via NetworkWorld: