Can Japanese games ever catch up?

[Mr Khan]

The west is only held to be ahead in the minds of the Western Core gamer, and in the minds of a few defeatists in Japan (mostly localized in Capcom). In the most objective guage we have, sales, Japanese franchises are still sales kings in most of their more dominant genres. Especially since you forgot one JRPG series that's stronger than FF: Pokemon

 

Though you have a point in that their unwillingness to really embrace the growth genres of the West like FPS and Sandbox may hinder them, but their old groups are still top dog otherwise.