As the smartphone moves from being simply a device to make calls to being a multi-purpose platform that can rival a personal computer, its processing power needs to evolve which is why a dual core SoC on the iPhone 5 is essential.
Apart from the fact that it makes economic and strategic sense to adopt the same Apple A5 SoC for its four existing devices, moving to dual core, both for graphics and for the CPU will provide Apple with more control over power consumption and therefore battery life.
Then there's the fact that Apple needs to catch up with its competitors; because it sticks to an annual product life cycle, much longer than its competitors, it has to deliver products, which as John Gruber from Daring Fireball explains, seem to come from a near future.
In other words, Apple must read ahead and surpass its rivals specification. Which is why the iPad 2 has caused many tablet competitors to review their plans and why the iPhone 5 will come with some ground breaking features.
The dual core feature also applies to the graphics subsystem which in the A5's case is likely to be 9x faster than the A4. Overall thogh, Apple is merely catching up with the competition as the Tegra 2 or the Exynos 4210 are likely to be superior in raw performance to the A5.
However, hardware is not everything and the jump in performance going from iOS 4.2 to iOS 4.3 shows that Apple engineers still have a trick or two down their sleeves.