The hardware is just one reason. Most Japanese like the things they buy to last and the appreciate product quality a lot. Even though Microsoft has extended the warranty and the issues may have appeared in less frequency, it's still not enough. However I don't think it's the main reason
What I think it's the main reason is not about the hardware or it's games. I believe the reason is in how Microsoft approached the Japanese Market. You cannot attract Japanese customers by just having cool RPG's and other kind of games they like to play in the console. it's the image they presented to the audience. So it's a set of bad marketing decisions mostly







