Apple iPhone 7 and even the 7 Plus is not perfect. Numerous rumors are posted on Apple's official support forums in which users have discussed the problems with their Phone 7 Plus image quality as compared to the iPhone 6 and iPhone 6s. The major complaints revolved around the general lack of sharpness and details, combined with the issue of blurry photos, alongside muted “water-color” effect dominating the shots taken.
The forum thread contains a number of photographic examples from users. These images do indeed appear to be of a much lower quality than what was expected from the new Apple's iPhone series. Users of both the iPhone 7 and iPhone 7 Plus reported the same problem, so it appears that it is not specific to the dual-camera hardware in the larger model (iPhone 7 Plus).
According to TCC, a user on the forums suggested a fix by disabling “optimized storage” option in the iPhone camera settings, however, that fix doesn’t work for everyone. Other users facing the same problem reported not having any issues in RAW captures in Lightroom, but the problem persisted when they used the Photos app. There are also numerous accounts of reports where users are having problems using both Photo-hosted images and RAW images.
Until now, the main reason of the issue is not clear yet. Some users believe that the problem occurred because of a mechanical failure of the optical image stabilization, while others think that the problem existed because of the unnecessary application of sharpening filters. A recent report on Apple Insider states: “Users having concerns with their iPhone 7 Plus camera should contact AppleCare, or make an appointment at a Genius Bar for further assistance and documentation of the problem.”
A user of either an Apple iPhone 7 or 7 Plus reported fixing the problem by turning off the "optimized storage" option in the camera setting of the smartphone, but this doesn’t appear to have worked for everyone.