This is not a highly pixelated image! The degree of granularity you are seeing is regular and ordinary for digital cameras imaging scenery at night. This granularity is called “noise” and it is caused by the camera’s software as it obligatorily apples amplification to the charges of photosites that otherwise would be void of detail due to under-exposure.

However, the chief failing you are seeing in this picture is what we call “flare”. Flare is caused by misdirected light intermingling with the image rays. The lens maker in his/her attempt to make a lens that yields a faithful image must resort to using multiple individual lenses in the lens array. The idea is to optimize the lens. Now each lens element of the array has two polished surfaces that act somewhat like a mirror. Each surface reflects away some light and this stray light bounces about. The net result is, some stray light baths sensor or film. This is the flare that reduces image contrast and generates star like rays that seem to spring from light sources and other highlights.