File System Conversion
When you update to iOS 10.3, your iOS device will update its file system to Apple File System (APFS). This conversion preserves existing data on your device. However, as with any software update, it is recommended that you create a backup of your device before updating.
Apple File System is a new, modern file system for iOS, OS X, tvOS and watchOS. It is optimized for Flash/SSD storage and features strong encryption, copy-on-write metadata, space sharing, cloning for files and directories, snapshots, fast directory sizing, atomic safe-save primitives, and improved file system fundamentals.
The upgrade to APFS is said to bring significant speed improvements and early testers of iOS 10.3 are already noticing the difference.
You can learn more about APFS here. Please follow iClarified on Twitter, Facebook, Google+, or RSS for updates.