No, it is really due to the screen on the phone. It has nothing to really do with software. Each pixel is noticeable because it is in a black grid. The brighter the pixel the greater the difference is between the grid and the pixel. By lowering the brightness that difference is reduced. It doesn’t matter what the contents of that pixel is so compression is of no value in resolving the issue.
The problem really is today’s phones. It is great the manufacturers brag about their screens but when you magnify and focus on them and halve the resolution because you are duplicating the same image on each half of the screen, the images themselves are fuzzy. It is sort of me looking at the world without my glasses. I remember during the olympics people complaining about the fuzziness when NBC was broadcasting in VR. We will just have to wait for phone screens to improve before we see the difference. Now if one uses the phone without google cardboard you get the full screen res…..moving the phone around arm’s length from your face results in a much clearer image, but of course, you lose the immersion effect.