This is inconsistency, people want to see the new phones were innovative, but do not suffer changes. We have a lot of improvements in the newest iPhone 7 smartphones, but people can not understand the lack of 3.5 mm headset jack. This standard is used for decades, so people do not understand why they can not use their favorite headset with new Apple flagship smartphone.
This decision is very brave, because lack of 3.5 mm jack interface is a thing that will affect everyone. For an example, audiophiles are spending hundreds of dollars on expensive and fancy headphones which provide very high music quality, also a lot of people connect their iPhone smartphones to home stereo or car audio player using AUX port. Fortunately, Apple provides an adapter in every iPhone 7 and iPhone 7 Plus box for free. However, why do we have to use additional adapter or buy new accessories?
Apple has removed 3.5 mm jack, because they needed more space.
The biggest innovative in new iPhone 7 smartphones is much better camera system. This is larger than before, not only because of larger aperture and additional sensor in iPhone 7 Plus variant. New camera system introduced by Apple requires also more advance image stabilization sensor and circuit. Because of this, Apple engineers had to move a tiny circuit board used for controlling smartphone display and backlight. Normally, they put this circuit at the top, but now they had to find new place for this. The best new position was at the bottom, but this place was occupied by obsolete 3.5 mm jack interface. Therefore, they have proposed to remove this old audio port.
iPhone 7 does not have 3.5 mm jack port not only because of new bigger camera system.
Thanks to this idea, Apple engineers have gained an additional space which could be used for bigger battery. iPhone users were requesting this change over and over, because they want to have longer battery life-time. Therefore, iPhone 7 has a battery which is 14% bigger than the one used in iPhone 6s. Also, 3.5 mm jack interface made it difficult to design water-proof iPhone. This is very interesting, that Apple does not anything about sound quality. People may think that lightning port guarantees better music quality than old 3.5 mm jack, but I am not sure about this. I think that wireless headphones are much better investment than lightning headphones, because you can use them with other audio devices, not only your new iPhone 7.