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Train wreck said:
Wyrdness said:

I'll add that many of them have to make games for their homeland as not only do they not have the luxury is western releases but even if they did the success abroad is often very limited and niche at best.

Those same games are limited and niche in Japan as well.  The biggest games coming out of Japan tend to be the biggest games in the west or are trending that way.  The smallest games in Japan isn't on anyone's radar, even the Japanese.  The whole notion that a subset of developers need to continue with a Japan only model is silly (and not even in droves happening anymore).  Its just a line that people use to extend Nintendo's dominance in Japan when in actuality a Japan only strategy is becoming irreverent. 

But a Japanese studio, or any other studio for that matter, can't survive on just these big games that may or may not fail. Hence you need all kinds of smaller titles to edge it out. And, of course, so it goes for people who opt for a platform for that big title, but want to play something else once they are done (and inbetween titles). So this notion falls flat. Japan is important, smaller Japanese studios are important, Japanese audiences are important. It is not just that, it is also a design and development philosophy that's unique and valuable. It is without a doubt a benefit to everyone that they succeed.