"For some people, it is possible to tell the difference if we were to sit down and study a [1080p] display and a [720p] display, side-by-side," he said in a phone interview with Ars. "If you’re really a fanatic and you study images, or you have some professional applications and you’re really into displays, then it may make a visual difference for you."
For most people, though, it won't matter. Photos are inherently fuzzy, so it won’t matter whether they’re viewed on a 1920×1080 or 1280×720 smartphone display; you’ll still see their imperfections. "Even the tiniest image detail in a photograph is always spread over more than one pixel," Dr. Soneira explained in a follow-up e-mail. "The image detail is never perfectly aligned with the pixel structure of the display." Videos are even worse: not only are they fuzzy like photographs, but the pictures are constantly moving. Even if the images were sharp, the human brain couldn’t zero in on content that’s appearing for only a fraction of a second on such a small display. "For ordinary viewing of videos, 1920×1080 is really not going to make a visual difference," adds Dr. Soneira.
Where a 1080p smartphone display could really make an impact is with computer-generated content—that is, the user interface, buttons, and text. "Only computer-generated images make full use of the pixel resolution of the display," says Dr. Soneira. "For graphics and text, maybe you want that kind of sharpness." Like desktop computers, smartphone displays can also utilize sub-pixel rendering, which helps improve the visual sharpness of computer-generated graphics.
A 1080p display might also be useful for simply viewing 1920×1080 content and not worrying about scaling. "Every time you rescale content that’s scaled for some other resolution, it’s not going to look as good. So there’s an advantage to living with 1920×1080 even if your eye can’t appreciate the fine details, because you don’t have the rescaling artifacts," he says.For most uses, however, the extra sharpness of a 1080p display is wasted.
After about 15 inches, "the much higher 326 ppi is 'wasted' because the eye can't resolve sharpness above 229 ppi." The further away a person gets, the more gradual the reduction in perceived image sharpness.
http://arstechnica.com/gadgets/2012/10/1080p-on-a-smartphone-screencan-it-possibly-matter/