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One thing to keep in mind is that in many JRPGs, Xenoblade included, all progression is linear and tied to the story. What he may (and I am pretty sure is) be referring to is that the progression through the world etc will not be tied to the linear progression of the story. So yes, similar to Skyrim: linear story, open world from the start. I have zero problems with this because unless there is a plot reason to gate off a region, having all open isn't a huge deal.