Without getting into too many technicalities, the bootloader is essentially the program that gets loaded first when starting your device, and it is responsible for booting the Android kernel. Think of the bootloader as the BIOS of a computer.

Most (if not all) devices are shipped from the manufacturer with locked bootloaders. This is for security reasons. A locked bootloader does not allow easy flashing of images, which means that it is difficult to change or modify the operating system. Unlocking a bootloader (using fastboot) on most Nexus devices results in a complete loss of all personal data from the device. Having a locked or unlocked bootloader has no bearing on the functioning of the device. Unlocking it gives you more options to play around with the OS. Additionally, an unlocked bootloader means that you can easily root your device no matter what -- unlike most non-Nexus devices, if you lose root, it is trivial to get it back.

Root essentially means that you have root (or superuser) access to the file system on Android. It is similar to being “administrator” on a Windows PC. It has nothing to do with your device or the bootloader, it has to do with the Android OS (i.e., you cannot “root” your device – you root the Andoid build that you are running). To have root, you need to be booted into the Android OS that you have rooted. If you are in fastboot mode, root is irrelevant. In order to perform root, you will most likely have to unlock your bootloader first (see above)

Recovery is like a mini OS, which allows you to perform various functions, usually related to flashing files to your device, or updating files, or backing things up, etc. The stock image has a recovery included, but its functionality is very limited. There are a number of custom recoveries available, but the two most popular for the Nexus 4 are CWM and TWRP. There are various versions of each. More details to come in this section.

A ROM is slang for an mobile OS build.

A stock ROM is a ROM that is built by Google and is signed by Google’s platform keys. Everything else is a custom ROM.

No, as was mentioned above, unlocking the bootloader allows you to (among a few other things) flash images easily to the device when not booted into the Android OS. Root allows you access to manipulate the files WITHIN the Android OS.

Yes. Because you will have to flash custom recovery in order to flash a file which grants you root access. For more information on rooting, refer to following points in spoilers within this post.

No.

No.

No, but it is recommended as some custom ROMs will have additional features which require root access.

While these steps might not be definite; these are however common approaches used by fellow owners.

1. Unlocking the bootloader
2. Flashing Custom Recovery (Either temporary or permanently)
3. Rooting (via Recovery)
4. Flashing Custom Kernel
5. Flashing Custom ROM

As shown above, the common process flow for unleashing our device. Step 1 is easily reversible via fastboot commands (or BootUnlocker apps via PlayStore which requires Root); whereby Step 2 - 4 can be reversed by flashing stock images via fastboot.

Head over to this link to read on what steps are required to revert to stock:

http://forum.xda-developers.com/showthread.php?t=2010312

Ensure that you install Universal Naked Drivers instead of the default LG / Nexus drivers.

Head over to the link above to download the drivers, and then use google's instructions to install the driver and browse for the folder extracted from the .zip file you downloaded (instead of Google's driver).

Read section C > Manual ways of doing it for a detailed instructions / guides

In order to check your CPU bins, you must be rooted and have Android Terminal Emulator installed, then follow the steps below:
1. Launch the 'Terminal Emulator' application.
2. Type 'su' and hit Enter.
3. If there are any pop-up prompts requesting for SuperUser access, GRANT it.
3. Type 'dmesg | grep PVS' and hit Enter.
4. It should return a line and show you whether if yours are SLOW, NOMINAL, FAST or FASTER. If it does not return these values, try rebooting your device and try again.

Note: This might not work on custom kernels as kernel developers might have changed the return value.
Credits to XDA Community for the original thread.

(Originally posted by cowithgun)

Kraits and bionic optimization speed up 2 things in your phone:

1. string / memory operation. these operation including string copy, memory copy, compare, etc. even a simply file copy uses these operation. all these implemented in a library known as bionic library in android. it's similar to libc in pc. this is the bionic optimization.

2. after Qualcomm introduce krait core (since S4), they release new code that allow you to use extended instructions that can only be found in Krait core to do some math operation. by implementing these new code, some math function such as sin(), cos(), etc will be faster. Many heavy graphic app uses math functions.

What custom ROM/kernel developer do is to get these code from Code Aurora, and implement in their ROM/kernel then recompile it. You may not notice performance improvement if you just swipe homescreen, etc but if you do benchmark, you will see a huge improvement.

For example, before any optimization, most N4 getting like 17k Antutu score. After Bionic optimization around you will get around 19k. You should see huge improvement in the RAM score, in this case 3274. Also check out the CPU floating point score, 2139, in this case, not optimized yet.



Now, if you optimize the math library with Krais extended instruction, you should see huge improvement in CPU floating point score, in this case 4182. With both optimized, you see a jump from 17k Antutu score to 21k, around 30% improvement at the same CPU speed.

Wug's Nexus Root Toolkit
http://forum.xda-developers.com/showthread.php?t=2015469
Video tutorial:


OR..

mskip's Nexus 4 Toolkit
http://forum.xda-developers.com/showthread.php?t=1995688

NOTE: Win+R is the shortcut of pressing the Windows Key on your keyboard + R, which will bring up the "RUN" command

PART 1: Prerequisites before unlocking & rooting: The Drivers Installation

• Download Universal Naked Driver
• Uninstall any current existing drivers for your Android Devices (Right click Computer > Properties > Device Manager; or just use the RUN COMMAND (Windows Key + R) and type 'devmgmt.msc. Reboot your PC after uninstalling these previous drivers.
• Plug-in your android device to your computer, and then follow the instructions listed by Google; except replace the driver selection with the Universal Naked Driver you previously downloaded.
• Congratulations! Universal Naked Drivers setup is now complete.

PART 2: Android SDK Installation

• Next, you'll need to have Android SDK installed (or extracted) to your computer. Go to this link, click on 'DOWNLOAD FOR OTHER PLATFORMS' and look under 'SDK Tools Only' (unless you're a developer ) and download the correct file matching your OS.
• If your downloaded file is .zip - extract them to C:\ and you should end up with a 'android-sdk-windows' folder within C:\; but if your downloaded file is .exe, install it as you usually would and set the path pointing directly to C:\.
• By right, your C:\android-sdk-windows\platform-tools will now have fastboot.exe and adb.exe, then you're clear to proceed! If you do not have these files yet, go back to previous directory and run "SDK Manager"; download the 'platform tools' and exit the manager.
• To test if everything is working well, start up Command Prompt from your start menu (or Win+R > cmd > ENTER); and type 'adb help' and 'fastboot help'. If it returns you with tons of help information, it works as it should. But chances are the system do not know recognize these commands (as they do not know the directory of these SDK files). Thus, you'll have to point the system to your SDK path within the Computer's Environment Variable. To do this:
  • Start > Right click on "Computer" > Properties > Advanced System Settings > Environment Variables (and if you're lazy just like me, hit Win+R > Type 'control sysdm.cpl,,3' > hit ENTER > A system properties in Advanced Tab should show up, now click Environment Variables)
  • Look under "System Variables" (at the bottom tab) and look for the variable "Path" (or "PATH"); double click on it and add 'C:\android-sdk-windows\platform-tools' behind. Do not that you may have to add semicolon ( prior to adding the path, if it is not already existing. After adding, your path would look something like this (example):
    
    CODE
    C:\Program Files (x86)\Microsoft SQL Server\100\Tools\Binn\;C:\Program Files\Java\jdk1.7.0_10\bin\;C:\android-sdk-windows\platform-tools
  • Now go back and launch a new Command Prompt (do not use the previous command prompt which failed to recognize the command) and try typing the commands (as in Step 4) again. They should work flawlessly now.
• Congratulations! Android SDK setup is now complete.

PART 3: Nexus 4 Unlocking & Rooting
Since this part is pretty simple I'll leave it to the original thread to guide you there . Refer below.

For full guide, refer to this link: http://forum.xda-developers.com/showthread.php?t=2018179

Head over to Nexus 4 @ XDA-Developers and have glimpse at all the available custom ROMs, kernels, customisations, themes, applications and etc.