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HTC reportedly cancels large-screened Windows Phone amid resolution issues

One step forward and two steps back. Sometimes that old saying can be applied to Microsoft, who despite doing their best to stay ahead is often slightly behind.

Such is the case with Windows Phone 8 and the ability to now have 720P and 763x1280 resolutions. On screens that are 4.7” or smaller, it’s simply stunning and a nice treat to have but its apparent limits may now be its undoing as HTC has reportedly cancelled a new Windows Phone because of it.

The phone, possibly the rumored HTC Zenith, has allegedly been abandoned due to the fact that Windows Phone 8 cannot do 1080P resolution, which would scale nicely on post 4.8” devices. The boundary, something for which Android has no problem with, is said to have been the deciding factor for HTC as anything less than 1080P would not be as competitive.


HTC Droid DNA (L) and the HTC 8X (R)

The HTC Zenith, according to the original rumor, featured a 4.7" 720p Super LCD 2 screen, 8mp camera with 1080p video capture, 42Mbps HSPA+, and a quad-core Qualcomm processor. We’re not sure if Bloomberg is reporting on that phone or another planned device with an even larger screen as obviously the resolutions don't match. Any solid information about the Zenith has been non-existent since June though with CES coming up in January, HTC would have a good venue to announce it.

Of course the 1080P resolution limitation is arbitrary in Windows Phone 8 as Microsoft can scale up the OS almost indefinitely (in theory the OS can support 64 cores for the CPU). But Microsoft needs to actually enable 1080P resolutions for OEMs and it is not clear if and when that will take place. That means the only hope for HTC to make such a massive Windows Phone is to wait until Microsoft updates the OS, possibly with Apollo+ for Spring 2013.

While all of that sounds great it of course means once again in terms of hardware, Microsoft is playing catch up to Google and Android. We could question the market for ‘phablet’ phones (e.g. HTC Droid DNA) and whether it is worth it for companies like HTC or Nokia to chase, but it misses the point: Microsoft is behind and it’s affecting their OEM partners, who have their hands tied.

Source: Bloomberg; Thanks for all who tipped us!

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HTC reportedly cancels large-screened Windows Phone amid resolution issues

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I always thought MS should have included 1080P screen resolution support with WP8 since it was clear that Android was going to go that route with some of their Phablets. MS needs to not just keep up, but leap ahead.

That's the problem with "suits". No vision, no commitment. Let's hope Microsoft wakes up otherwise there will only be Google

So true. Even though you might not be able to see the difference people will pick 1080 over 720. W8 has a long ways to go to catch android. W8 should have leaped ahead but it's not even equal yet. Not having 1080 will hurt when you have a undetermined consumer doing side by side comparison. Not to mention the video compatible issues between W8 phones, computers and Xbox.

Absolutly. Go check the sales numbers for the Samsung Note 1 & 2. It sold so good (Note 1) internationally that ATT jumped on it for the USA. Now Verizon, T-Mobile and Sprint now sell them. Also LG and HTC are pushing them out. That's what makes this sad. You got OEM's and carriers pushing these awsome phones more that W8.

I thought the same thing when I heard the spec limit. I don't understand why if they had the foresight to support up to 64 cores, why wouldn't they plan ahead for 1080p and beyond? Playing catch up just won't do.

That'd equal instant death for HTC as they need to remain competitive against the likes of Samsung.

HTC will do far better releasing for both platforms.

(I'm assuming you want HTC to become a windows phone exclusive vendor)

With the battery life people are getting with 8x and Lumia 920, I'm not surprised why there are no quad core and 1080p windows phone yet. Earlier this year Microsoft explained why they don't have dual core for windows phone 7 because they wanna do it right.

Not sure what you are talking about. I have better battery life on my 920 than I had on my Omnia7.

And what difference will it make when the end result is the same sub par experience compared to what you get with a Nokia WP? Will having 1080p make HTC support it more with better apps or will they still load it again with their android look alike unit converter? Will it have anything innovative like OIS, City Lens, Drive, Puremotion, super sensitive touch? Focusing on just 1 hardware spec wont make their devices any more attractive, the better sales of Samsung's android line and possibly Nokia's 920 seem to bear that out.

Because they suck... I like the 8x but I'm starting to question why I bought it after this crap...lol!

Probably cost and supply issues--they're already using 5" 1080 screens, but who has 5" 720P screen on hand? It's more cost effective for them to over-lap production. Plus, it's a tough sell if your Android sister device has a 1080P screen...can you imagine what the tech press would say?  "It's a nice phone but the lack of 1080P really hurts it".

The headline would already be written.

This is the point that should be put in the main article... I didn't find it clear either. But it makes much more sense if they can't just get existing screens of this res.

Yes, the Note II has 720X1280 and it looks very good but the GSIV will probably have a 1080p screen so it would have been great had HTC been able to come out with a 1080p Quad-Core WP8 device in 2013 if only for the bragging rights.

This doesn't realy make any sense.  A 5" 768x1280 screen still has a PPI of like 300.  There has to be more to the story than this.  Sure a 1080x1920 would be like 440 ppi but there comes a point where increased resolution has huge performance and battery life issues compared to the advantage, which would be minimal over 300 ppi.  The average eye just isn't good enough to see the difference, or at least to see a big enough difference to make this worthwhile.
I would guess that the resolution is more an easy scapegoat than the truth.  The truth is more likely that sales projections of a phone this big were just too small to justify the R&D.

Good point. I was thinking to myself, if you can make a 4.7 inch 800 X 480 (TiTAN and TITAN II), there's no reason why a HD+ resolution won't look great on a 5 inch phone (And still have a high PPI).

The selling point to the masses is the 1080p. That alone has been the selling point to those I know who have purchased the HTC DNA. And its a very nice screen.

I have yet to meet a single person who has a Droid DNA. I would bet the current sales numbers on it are probably pretty low. Sure it has a large 5" screen but 16GB storage that is not expandible on a device like that. The main reason to have a screen like that would be for multimedia which takes up space which the DNA lacks... The phone is also locked to Verizon which is a sales killer 

Just like the 5+ inch screen of the Note was its key selling point but it matters not what enthusiasts think but what the mass consumer does. Buying a phone for a great screen is one thing but if the performance is hampered (because its more pixels for the processor to push) then its a trade off that most people don't want to deal with. Not to mention battery life.

Thank you, I was about to scream this point out.  Is there any respectable technical writer out there who claims 1080p on a 5inch device actually matters?  But whatever, MS should allow 1080p because veraity is good and consumers are fools for specs.

That's already a criticism of the HTC DNA. The DNA has very high resolution, but it actually has some lag because it's pushing so many pixel that people can't see unless you use a microscope.I was reading an article comparing the screens on various phones. The screen was dimmer and the color was a little off. The article had the iphone and lumia 920 at a tie on top. It was interesting that the Galaxy S3 was at the bottom. Here is the link
http://gizmodo.com/5960289/htc-droid-dna-vs-iphone-5-and-everyone-else-whos-got-the-best-display
It would be cheaper to use the same screen on multiple devices, but using 1080p on a 5" screen doesn't make sense.

Exactly, the battery and the lagginess of the Droid DNA were brought up in all reviews. I do want wp8 to leap forward but engaging in this particular spec race doesn't seem the right place to wage the war when there are so many real areas they lack they could improve on first and instead.

I'm not sure what the Windows Phone 8 OS would do on a quad-core with a better GPU, so I have to agree it's hard to say what would happen on a display with a higher resolution.  However, anecdotal evidence with their Droid DNA would indicate that even with Android 4.1 (which is a pretty smooth OS), it doesn't work all that well under load.  Also, have you ever used an app not designed for the resolution you're using on an Android?  That can range from "OK"/fine to "fairly bad", and I don't know how some of the more multimedia-intensive WP8 apps and games would do scaled up to a non-native resolution.
I think we may have to wait for Microsoft to test and release WP8 on more modern hardware like what we see on the high end (quad core, better GPU) perhaps next year before we'll see a 1080p resolution on a WP8 device.  However, if past history is anything to go by, if Microsoft *does* do that, it would perform very well on such hardware, and with good battery life.  Here's hoping, as I'm up for a new phone (much) later this year :).
 

I believe the story is things like the algorithms for sizing tiles and possibly even the landscape app template.

Here's five little questions I've been wondering:
 
How come everyone's perfectly fine with their 22" monitor being only 1080p but if their 5" device does not have the same resolution it's suddenly the end of the world?
 
Why are people so interested about the absolute specs instead of the user experience as a whole? 
 
Why should anyone care if their WP8 device doesn't have quad core S4 Pro when it's so fast and fluid as it is? I mean, what's there to improve?
 
How come some people prefer the buy the best specs currently available to be "future proof" when they upgrade every two years anyway?
 
Lemon curry?
 

The answer to all those question is simple. People just want to have those things for the sake of having them not cos they need them. I read an article calling lumia 920 the most advanced phone today which is indeed true but what do you think people who didn't think so were saying? The screen resolution is nothing new and stuffs like that forgetting that the lumia 920 can be used gloves, best build quality from all the phones i have held in my hand, doesn't need quad core cpu to run smooth without lag, great Kamera technology and so on.
Another reason is the so called tech sites, they make everything worse. To them an iphone with a dualcore cpu is ok but if it is a Wp it most suddenly have the same number of cores like an Android phone.

1.  I think people would like to have higher resolutions on their monitors, but they're just not as available.  Also, keep in mind that people hold their phones a LOT closer than their monitors.
2.  People are interested in both.  The WP experiences isn't necessarily better to everyone, and if specs on one are better than another, that's an advantage for the former.
3.  Future proofing.  Also, not EVERYTHING is fast and fluid.  There are plenty of slow apps in the Windows Phone store.  That may largely be because of the developers, but better hardware can still compensate. 
4.  Not everyone upgrades every two years.  Even if they do, they'll likely get at least one major update that the better hardware will handle... better.

Idk how true that higher resolution monitors are not available part is...honestly speaking 1080 is too low on 24" I have to have a minimum of 1440(which is what I'm using right now)...it's more to do with the fact that people are brainwashed into thinking 1080 is the absolute best so anything else is subpar.. For example one of my techie friends just upgraded from a 24" 1080 monitor to a 27" 1080...and was proud that he got a bigger monitor and it was still 1080...when in fact on a 27" its about 80 ppi while on a 24" 90 ppi...both of which are subpar on monitors that size...its the media influence

1. They do not hold them that close enough that the difference would require compensation.

2. If someone does not like WP they will choose a different OS despite the specs.

3. If some apps are slow and others are not, the blame goes precisely to the developers of those slow apps.

I agree. You buy WP for the OS, I doubt people are passing this up because of a lack of 1080p screens, when all Androids except one have sub-1080p screens.

Simple. Microsoft does a piss poor job of promoting their phone OS. Their concentration has been on live tiles. Which while great, isn't a huge selling point. Manufacturers can only push design and spec. Its a huge advantage if you can claim the best specs. Its like telling Ferrari that they can't develop a better motor. Just keep changing colors and body style. Extremely hard to lead with those constraints. Microsoft should be coming out swinging, enabling their partners to succeed. These types of news stories\rumors shouldn't exist.

Car analogy does not work in this situation. There is no software engineering involved in making the car run better and for that, standardized hardware does have it's benefits.

Sure. They standardized the roll cage. It wasn't meant to be an exact analogy, constraints is the point in either case.

Have you seen people holding those comically sized "phones" up to their heads? It's hysterically funny. It's like holding an ipad to your face and having a conversation

I know and imaging the phone size will be 7" to 10" and people will still buy it because it has big screen. I might as well take my 50" flat screen t.v and turn it into a phone. I would like to see a person bring a 50" phone with him/her and make a call.

I'd prefer a 6 or 7 inch "phablet" running Windows Phone 8 (or RT with phone capabilities) plus a Bluetooth headset for taking and making calls. Honestly, I yearn for the day when I can replace my laptop, tablet, and phone with one reasonably-sized device that gets 20 - 24 hours of battery life. I can (and have) replaced my laptop and tablet with a new Windows 8 tablet, but If I could roll my phone completely into that package and get the same sort of battery life on the tab as I get on the phone, I'd buy that device today. I have no doubt it's coming either, given the shrinking of tablets and mobile computing devices and the ever increasing sizes of smartphones running similar OSes.

Functionality of the OS I won't comment on but I you can already hook up a Bluetooth keyboard to the phone and get a little work done.

I would love to see the ability to plug your phone into a shell of a computer and have the phone supply the CPU power, storage, AND trackpad (using the touch screen!) for the shell.

Maybe if someone had frying pan hands, I could see it. I wear large gloves, and my 8X can give me a reach one handed.. I wasn't even sure about going to this from my Radar (3.8"), but a drop made that decision for me. I'm ecstatic about my "little" 4.3" 720p Super LCD.

I agree on that. My opinion is that 4.5" - 5.0" is about as large as you can comfortably use for an everyday, carry it with you device like a phone. That also is depending on thickness and bezel. My wife, however, wants as large of a Phablet as she can get. She already carrys around a duffle bag disguised as a purse, so for her no sweat. I actually like me 4.3" Focus S, and like her 4.7" Titan 2 a lot. Wouldn't want too much larger then that.

I call bs as the galaxy s III has lower then 720p res on a 4.8" screen and the galaxy note II has a 720p display on a 5.5" display. 720p is fine on anything 5" and under and not bad up to 6 in ( I mean the iPad mini has less then a 720p on a 7.8" display!)

While that is true, I think you're still missing the point for a company like HTC: mirroring what others did 6 months ago is not a strategy for winning. 

They want to be able to push Windows Phone to the max and offer something new, eye catching and "wow worthy". A 5" 720P device would be nice. Would it be earth shattering in 2013? Definitely not.

The fact of the matter is WP8 should not be limited by the 720/760P limit, crippling OEMs. You can't innovate when under such a strict leash.

They should drop the limit on resolution and start supporting aspect ratios. 
What I would like to see is MS to come out with a Phablet that does something besides add a larger screen. The Note is great because it does more than a normal smartphone and they are experimenting with the additional screen realestate. This is the perfect area for MS to jump into the smartphone market. Make a phone that takes advantage of the additional screen realestate and provides a KILLER OneNote experience. Samsung can't make software very well and it's the perfect entry point for a Surface phone. Let Nokia have the camera and standard phone experience, let HTC do what HTC does, and MS can build a killer business / note taking device under the Surface brand.

So the solution is to not try and don't compete? I'm not sure where you are going with this...

WIndows Phone is already a tough sell in the mobile landscape. Hindering resolution options is not helping. 

So a rumored device is allegedly canceled? First, this site needs a rumors page so this can be classified with rumored upcoming rumors. Second, I appreciate the fact that Microsoft has gone for competitive specs that are still conservative enough to accommodate most phones people actually use without going to extremes that would complicate easy OS level updates. Go much larger and you have something that is too small to use as a tablet and too large to easily use as a phone. I'm also waiting for someone to start selling flavor flav style pendants to haul around the Galaxy Note II and LG Intuition monstrosity, both of which VZW store staff are hard selling with limited success.

"First, this site needs a rumors page so this can be classified with rumored upcoming rumors"

Umm..it *is* classified as a rumor with a tag at the top and we do have that category.

Second, it's Bloomberg. They're policy for running "rumor" stories is to have two confirmed sources. They're quite reliable on these things--it's like if the WSJ or NY Times report on something similar, it's not "some guys blog".

Same with the original rumor of the Zenith, it came from the Verge who are generally reliable on these rumors.

Isn't this a really silly complaint when Samsung is selling loads of their Galaxy Note II devices, which have 5.5", 720p screens?
 
The only reason I won't buy from HTC is because after having a Droid Incredible that got very little support, I have no faith in them to put forth a solid effort on the software side. You sort of saw it when you compare the Nokia app selection to the HTC app selection on Windows Phone 8 as well, and seeing them complain about 720p when Samsung's killing it with that same resolution just continues my questioning of what kind of idiot is calling the shots there.

Once again, it's not about mirroring what a company has already done a few months ago, but about pushing it further. Samsung is already talking abou the Galaxy Note 3 for 2013...

I agree Daniel. Titan was in its own league, back then. Same for the Note until recently. Now.... Maybe if MS "gave" some of the tech from the Surface display... Its so good, don't need that power robbing stuff. All day battery. Maybe..

People want to keep up with the Joneses. They want what they get told to want. Buy what they get told to buy.. I mean c'mon now, how else do you think the iPhone5 sold so many units at launch.. Italian leather, Kobe beef, Kentucky Whiskey, German cars.. Its more to do with the buzz than anything else. "Next big thing!!" Simple fact is, majority of consumers don't research anything before making a purchase... They go off what they see when they turn on the TV. Word of mouth is strongest though, that's why I show my 8X off to EVERYBODY!!! Show them my gorgeous HD screen. I think I may have made a few converts already..

I personally really wish wp8 handsets went with the s4 pro instead, namely for the 320 gpu which is sooo much better than the aging 225 in the s4 on the current handsets.

I don't know if any of this is true or not but MS will add support for more cores and resolutions in the next big update. Till then I think that if HTC really wanted to make a 5 inch device they could've with the current max res. Few people would even notice the difference in the end.

I don't see the point of a 5 inch Windows Phone "phablet"
1. The tiles would look extremely huge
2. You can't have 2 or more Windows at the same time or snap view your apps
3. It would just be way to big
Until MS changes the UI again the perfect size for WP is in the 4" market from 4 - 4.7 anything bigger is just added weight.
I'm sure HTC realizes this instead of spending $$ towards a 5 inch phablet focus on better 4" phones on all 3 price markets.

Very short sighted.

1) Resize the tiles, and enjoy.
2) Ummm..... so what? No offense, but I have a sneaky feeling that this alone would not stop sales.
3) That would be entirely your opinion, and sales of the Note 2 and the original note kinda show there is a strong market for this.

Why would MS not support competing for this market segment? A WP Phablet would sell, and HTC would be happy to put one on the market right next to the Note.

I have seen women strolling around with a child in a buggy while attempting to use a Galaxy Note II, too much of a Ridiculous size.

Strangely enough, many women like the idea of a large phone for it's easier to see.  Same is true of those 40 something and up.

Yes, because we need WPs with terrible battery life and lackluster viewing angles. Wouldn't want to lose that important spec war...

Seriously, anyone actually looking to buy a larger than 4.8" screen mobile phone? I have a Titan and I could not go much bigger without feeling like a total tool.
Whilst it is a shame that OEMs are being held back for whatever reason, I do not personally feel a loss with this. If it was a 1080p 4.5" phone I would be upset, but thats not the issue... 

I don't understand it, either, but then again I don't understand 24" rims on SUVS/Trucks/Anything, why anyone would willingly listen to Justin Bieber, and why people are so stupid.

So how is it that we knew 6 months ago that WP8 resolution was onlygoing up to 1280x768 but somehow HTC missed that memo? Not that this really matters to me cause i literally couldn't hold a device that big and would never even consider it

It's probably a re-evaluation of a planned project. They realized that by the time the device came to market, it wouldn't really be cutting edge. So it was canned.

A company like HTC only has so many resources.

 What does it mean by 1080p? I think my lumia 920 already has 1280-768p. Does it mean 1280-1080p??

Bloomberg's wording felt negative, even though true, they could've said "HTC waits for MS to enable 1080p on WP before moving forward on large-screened handset." Come on guys (Bloomberg), get with the program.

I think there is no need for a 1080 resolution on a phone its silly 720 is enough. Plus I dont know why HTC are complaining they would of still made a great phone with that resolution. HTC cant even get their other phones right like the 8S as they crippeled it with 4GB of storage. 

 
The ultimate goal is to have a resolution that reading on it is like reading on a paper magazine.

The conspiracy theorist in me thinks there's no 1080P or universal landscape (or rotation lock) to prevent the possibility of WP8 tablets.  I know that HTC was denied an opportunity to make Windows RT tablets and MS wants to exert a lot of control over RT.  If WP8 supported 1080P and full landscape mode it would be a sweet competitor to a Nexus/Amazon device.

I agree Daniel. Look at firebird/camaro, thunderbird/cougar, Monte carlo/regal, Chrysler k-car, Budweiser & Michelob...

Look at Samsung with the ATIV S & the GSIII. Same basic phone..

Titan was in its own league, back then. Now.... Maybe if MS "gave" some of the tech from the Surface display... Its so good, don't need that power robbing stuff. All day battery. Maybe..

MS really should enable 1080p for OEMs. I think WP needs something to match Note2&3. These Phablets are really a market and on the other hand would enable OEMs to fill the Surface Mini gap. A 6-7inch WP8 device with 1080p display would definitely be something I would buy,especially if Nokia would make it.

Someone said it here that resolution could be the scapegoat on why HTC canceled this, and I am leaning towards to that because HTC knew the specifications of Windows Phone 8 from the start.
In addition, maybe the OEMs are waiting for MS to support 1080p in SLCD3? 

Just like with WP7 not having a dual processor due to battery performance; MS could be evaluating battery and 1080 resolution performance at the moment.

If Apollo+ was able to fix this, then I don't think HTC would have cancelled a phone over this. Surely they have enough of an inside road with Microsoft to know the "feature they need" is imminent. I think they have a different reason, or Microsoft won't make higher resolutions available for now. Not that I see the need for them (or for 5" screen phones).

I want 1080P on my TV, not my phone.  It's just a preference I know but it comes to a point where cramming into the tiny devices is absurd.
 
It's like putting '0 trans fat' on a bag of potato chips.  People will buy it thinking it's better for them than if the bag didn't say it.  The problem is, it isn't any better.  It's just a buzz term/word/phrase to get your moneys.  Having the capability for 1080p would be nice, sure.  I'd still only want it on a large viewing area like a monitor or television.
 
To each their own. :)

HTC is rudderless ship. They throw devices up against the market and pray something sticks. 1080P mobile devices has a nice ring to it, but the half day battery life is the last thing people want in a mobile device. A year from now the Galaxy S4 and Note will have 1080P but that spec won't make them better devices. If I was Microsoft, I'd go the Apple route and stop announcing publicly the new spec sheets. Specs aren't gonna win the mobile war, experiences are. The note sells because its different in many ways from all other devices. The Galaxy line wins because it was the very best alternative to the iPhone. How about HTC goes in the lab and starts engineering a coherent package of software and hardware innovations that come together like the Note II and the L920. How about they actually release a series of updates for the issues their devices experience after launch. How about they stop crying about a spec and get back to building a user base excited about one of their products. They're like the winy middle sister that can't live up to the star older sibling all while being terrified of being passed by the younger sister that will not be contained. Compete instead of complaining!

I donno someone said it before I think it's more the support the oems give their phones. Mind you people do want 1080p and I'm sure they'll get it eventually. I'm pretty sure that ms did say that wp8 was just more so a template, meaning it can always be updated right? Its not gonna end up like wp7x anytime soon. Just hang in there:)

If I was HTC I would not make a 1080p WP8 device before 2014. 3 reasons. A) The 8X is a great design, providing 32 and 64 Gb versions will result in more volume and lower unit costs. A win win fir HTC and consumers. B) They do in fact have a 4.7 inch device that could be adapted to WP8... The OneX. Just software tweaks, maybe a different SOC but I doubt that such is needed. Again here more volume is a win win. C) An improved 8S with the same smooth glass as the 8X and 8Gb plus microSD would also sell great and be one of my priorities.
Last... If the OneX can run WP8... HTC could sell a software pack which updates firmware and installs WP8... Sell that for $99.- and the OneX sales and resale value will rise.

The OneX being an Android phone doesn't have the necessary hardware buttons (no dedicated camera button, improper button icons) to support WP8.

I don't even know what the problem is. The human eye cannot distinguish between 720p and 1080 on a screen size that small. 50 inch TV maybe, but a 4 inch screen? No way.

When determing optimal viewing you can't just use screen resolution as a factor (i.e 720p v. 1080p).  Three general things determine clarity: Resolution, Viewing Distance and Screen Size.  Basically, once a screen size is 7" or less, the viewing benefits between 720p and 1080p become almost negligible.  So while 1080p viewing has benefits on a tablet, it really doesn't matter on a phone except maybe to a very minute number of people with high visual sensitivity.
 
Besides the three determiners listed above, how the pixels are processed is even more important. Per the Imaging Science Foundation, the most important aspects of picture quality are (in order): 1) contrast ratio, 2) color saturation, 3) color accuracy, 4) resolution. Resolution is 4th on the list.
 
So basically this debate about 720p vs 1080p on a smart phone is really silly.  However, I do agree with the forum posters who say its more for marketing than for actual quality.  Perception is reality regardless if it's true or not.
 

That's some quality crap HTC is spewing. Note II with a WHOPPING 5.5" DISPLAY has 720p resolution and is currently the king of Samsung's empire (maybe the queen, after SIII) and 720p is suddenly not enough for a sub 5" phone?! Are you kidding me?!

While 1080p on a 5.5" screen is gimmicky, sometimes gimmicks stick, and if this one does, Microsoft will be stuck.  Higher spec limitations are stupid.  Performance limitation are what Microsoft should have implemented.  2 years from now 1080p 5"+ smartphones will be cheap and/or commonplace, and the reviews of the newest 5"+ WP8 phone will read," If only it have 1080p". 

I understand that people look for specs to compare which phone is better. 
I think may be Microsoft want their users to have the optimum experience and 1080p might be a little hard on the battery or they might not have optimized it to the fullest and don't want to rush into it and ruin the experience?

The answer to this is simple: Marketing.
Greater specs are an excellent way for these companies to maket and push devices. A lot of people like to know that they have the newest best possible hardware out there. 
Would I personally buy a 5" 1280x768 phone? certainly. but if i was the company creating a high end phone that i wanted to be a staple and surpass the compettition then 1080P would have to be at the top of the list.
Micorsoft needs to do something about this going into 2013.

HTC should skip forward to 2000p with their next Android series. That would make the spec-sheeps drool and choose the products of the ocassionaly innovative smartphone company that is HTC over the the plastic products of the kitchen appliance producer that is Samsung. In the next steps HTC could start converting its new followers from droids to WPs.

It really just comes down to Microsoft making these things possible for OEM's. Doesn't mean that they have to have 1080p screens but that they can if they choose to. As the software provider they have to make sure that their OEMs have all the tools they need to make the best phones for the market. 

No, go for 108000000000000000p, with a 25 year battery life, on a 2000" screen. 64-core processor clocked at 1024THz per core, 9999999999999mpixel camera, ImageSense, Beats Audio, 100000000000000000000TB storage space. All in a package that is 0.5mm thick. And with only 5mm bezel above and below the screen, and 1mm bezel each side.

Damn I wanted this phone. Hopefully the next big update for WP8 will support this especially with MS' and HTC's close relationship. I do understand where they are coming from though. With the 8X having one of the highest PPIs they are trying to win the spec war. At least this will give me more time to save up.

1080p on a small screen does not matter.. Its all hype and numbers if you ask me.. No one can even tell the difference. A 32" TV is fine with 720p, once you go above 32" then you start to see how it differs. This notion that a 4.7" screen needs 1080p is BS. Its not a need. HTC will do fine making the phone in 720p with a ppi over 300. No one will complain about the quality. No Microsoft is not holding OEM partners back and 1080p android phones is for marketing hype value, the benefit between both resolutions don't out way the other on a small screen. It frankly does not make an ounce of difference.

I totally agree with everything you said about 1080P on a 4.7" being a non-issue.  But just for clarity sake, when viewing a 32" screen once you start sitting closer than 4 feet from the screen the difference between a 720p and a 1080p 32" screen will start to become apparent.  That said, should you really be sitting closer than 4 feet from your TV anyway?

I watch movies on a 720P projector on a 72" screen, at that size a 1080P projector would be nice based on the projectors I have seen (although they are also much higher end models), although the difference is subtle.
On a 6" screen though I think someone is having a laugh :D

The whole 1080P on a mobile phone being upto 6.3" in size is just ridiculous.  My desktop monitor is 2560x1440 and its fine at 27", granted its a little further away but not that much.
If people really do want to have a 1080P phone then they either need to sacrifice screen update speed (set it at 30Hz) or else they have to accept the screen has 2X the power consumption both of the screen and its GPU.
Personally I think if they put a ~5.5" "Phablet" 720P windows phone up against a 6.1" android phone that had 60Hz 1080P the 720P would win in terms of appeal since it could be used for a reasonable length of time. 
For the 1080P phone to do that it would have to either sacrifice refresh speed and smooth scrolling, or be a bigger heavier device, so whatever it does a 1080P phone gains a meaningless marketting number in return for losing a saleable real feature, all at the extra cost of the higher resolution screen.
 
I'd really like to see a Nokia tablet appear for Windows 8, but maybe they should start here with a mid range Phablet, make it affordable and stylish and sell buckloads, let the higher res fad claim its fashion victims, with todays battery life it just isn't worth it.

 Now Sony goes to 5" full-HD. By next spring, all fragship Andoroid phones will be full-HD including Samsung Galaxy.