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I'd say a focus on cutscenes is what turned Square Enix into such a mediocre company. Considering how much space and time cutscenes take... and considering how amazing the 360 and PS3's graphics are you'd think they'd give it a rest already. They can already make awesome graphics the cutscenes are just wasteful crap that could be put into more playtesting, innovation and gameplay.

A lot of other companys have the same problem, but Square fell the furtherest. Then dragged Enix down with them.