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GamesBond said:
I think its tough to point to 1 overall reason, but there are plenty of reasons why it failed in japan other than the one stated.

- initial failure rate of 33% for 360 at launch,(which becomes much higher when you ask how many of those are still alive 2 years post launch)

- perhaps lack of JRPGs.

-Or the simple tech available at launch. Blu-ray versus external hd drive, wifi versus external wifi adapter, large hard drive versus separate purchase of swapable hard drives, browser vesus no browser, free online gaming versus pay.

I dont want to turn this into a fanboy war, but from a product perspective maybe the real question should be "why did 360 do so well in the states and europe".

My answer: 1 year head start.

The high failure rate certainly didn't help, everywhere, but the damage was less in the US due to Microsoft's strong marketing in the region.