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With third party stuff, or at least the big AAA stuff like say Final Fantasy, I think it's also a matter of the Japanese audience losing interest because the main ones just stopped coming to their platform of choice.

Current mainline FF hasn't been on a popular platform there since the PS2, same for Resident Evil, etc.

A whole generation of Japanese (those who were DS/PSP/3DS/Switch kids) just grew up without those games, and so don't have a nostalgic attachment to them the way that Millennials who grew up on SNES/PS1/PS2 do.