Water-colour effect result from heavy noise suppression post-processing.

It seems Sony knows how to build the best sensors, but fails in algorithm.

Even highest end Xperia Z series doesn't fare much better against competitors.

yup
the picture produced like noise suppression mode
looks soft, not sharp like other phone
if refer from my pic, even in great light (afternoon mode) still got denoise effect when 100% crop
sadding

superior mode sucks btw
i avoid to use it but it cant be helped, when pressed the shutter to activate camera, of course automatically go to superior mode and quite hassle to select manual mode if need quick shot
some examples from my z1 taken recently with lolipop version
[attachmentid=4651668]
superior mode

[attachmentid=4651674]
manual mode ISO800 (yeah i know its too low for dark)