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The japan problem is complicated. And no, they haven't just gravitated to handhelds, handhelds are just wheer the games r for them right now. but this is what is happenning in japan now.

  • HD develoment is expensive, like 5 times more expensive than SD development. 
  • Jap devs don't think like wetern devs, they want there to be large install base first before supporting a platform. That way they can guarantee sales and profitability. 
  • Gamers will not buy a console until there are games to play on it and since the jap devs don't wanna make games til there are gamers that have it...then yh.
  • so they make games for handhelds and the jap gamers buy the handhelds cause the games are on it.
  • lastly, the japs aren't big on majority of the genres that we play over here in the west.