Yes they do need more iron but that's why you start solids at 6 months of age, because milk is not enough sustenance for them anymore (regardless of whether it is breastmilk or formula)...and if you check the back of the tin you will see hardly any difference between Step 1 and Step 2.

My DS's digestive system couldn't tolerate Step 2 till he was nearly 9 months and I never bothered at all with DD. I only put him on Step 2 in the vain hope he would start sleeping through the night...never had this issue with DD. I did a bit of research on this and my best friend used to work for Nestle so I had the inside word on formula composition!