No, it is not because of hardware, it is because of the stock youtube app itself. It seems to have been designed to primarily play a youtube video in very very low resolution/quality so that it plays quickly and smoothly. When you tell it to play in HQ, you basically are telling it to play the videos in the highest resolution possible and that you don't mind if it takes it longer to load the video than it would in SQ. It may also be that the app is trying to choose lower bandwidth over higher. Hardware doesn't seem to be a factor in the app always playing in lower quality initially.