This would be a big departure for iPhones, which started using the Touch ID system in 2013.
Thus far, we've heard two arguments.
According to the investor note, Kuo said he believes Apple's new premium handset, dubbed the iPhone 8, will feature a home button under the screen. Apple is reportedly using a laser-guided infrared sensor in a bid to reduce latency and improve scanning responsiveness. This solution certainly sounds more appealing aesthetically although rumors of manufacturing issues have led some to doubt that it'll happen with this year's refresh.
Just this morning, KGI Securities released a report stating the upcoming iPhone 8 would drop the Touch ID sensor entirely, leaving the question as to what type of security functionality would be included in the device besides a normal PIN. At the time, Qualcomm said that it would be collaborating with Vivo to demonstrate its Qualcomm Fingerprint Sensor for Display and Metal. Kuo doesn't make any mention of the Touch ID feature being moved to another part of the smartphone. The latter option seems unlikely given how widely used Touch ID is.
While the new devices will maintain the legacy lightning cable connection, they'll also have an embedded USB-C power delivery integrated circuit (IC) for faster charging.
Apple's push for alternative login methods also lines up with its larger design goals for the iPhone.
We have had quite a bit of rumors and speculations regarding the Apple's upcoming iPhone 8 that will also mark 10 years of iPhone.
Placing such a sensor in the screen is a challenging task, which is why Apple might not do it, and why Kuo and others might be right.
They claim the technology is capable of scanning through OLED display stacks of up to 1.2mm, as well as up to 0.8mm of cover glass and up to 0.65mm of aluminium. In addition, there is also an eye-scanning technology that's going to be present to provide another layer of security for users, much like what Samsung has done with its Galaxy S8 and Galaxy S8+. OLED clearly indicates towards the iPhone 8 whereas the LCD phones are expected to be iPhone 7s and iPhone 7s Plus.
Mashable reports that the under-display feature came at a time when every other mobile manufacturer was competing in terms of screen size.