Japan seems to be moving away from the home consoles and going handheld atleast throughtout the 7th gen, can the PS4 renew what Japan was with home console gaming (big epic blockbuster games).

The Xbox one is not going to spike anything I'm sorry don't mean to sound like flaming but Mirosoft did everything in their power to get exclusives and timed exclusives for big games and even getting FFXIII when it released and it still only managed 1.6 million in 8 years, an imporvement over the orignial Xbox but still not much of an accomplishment. It's hard to say anything about the WiiU but in terms of third party games I doubt there will be an abundance of games for it, mostly first party. 

Hopefully the PS4 spikes some huge numbers and makes Japanese developers inspired to make huge (actually good) games like they use to, instead of popping out as many games as they can for the handhelds.

So what do you think is handheld gaming really going to be the future or is home console gaming alive for atleast one more gen in Japan.

I don't see anything that the PS4 does very differently from the currently dominating consoles, so I don't see why it would shake things up.

The PS4 seems to have the best chance at it but I'm still not sure if it's exactly gonna be a repeat of the PS2. If japanese game development can rise in quality once more then the PS4 may actually have a chance in succeeding but at this point it's too early to tell. Since capcom is likely to go out of business and square keeps losing money right now, I'm not sure about PS4's future in japan.

Are you insinuating that handheld games are inferior to console games?

No, it's not going to do light up the charts in Japan. Expecting PS3 Lifetime ballpark, a bit more popular console but shrinking home console market should put it right there.

Reason why? Stupid Japanese developers. 2014 will be a year of PS3, a couple of ports on the PS4, which most probably Sony paid for.
2015 will again probably see mostly PS3/PS4 multiplats, this time maybe without Sony moneyhatting the ports.
In 2016 we should finally see a wave of PS4 exclusives from the developers of games from 2013/2014. Still a couple of multiplats here and there. Finally a reason to jump on the PS4. Add to it that less and less Japanese developers go with the AAA model, and ever growing mobile market.

We've already seen the exact same pattern with the PSP/PSVita. First year mostly PSP games, next year PSP/PSV cross gen games, it's 2013 and the biggest Vita games of the year that weren't from Sony had all PSP versions, even though they were consistently outsold by their Vita counterparts. The same will happen this time, but the Japanese morons will still push PS3, holding the adoption rate.

This is all very ironical since Japan is usually the first region to ditch last gen hardware the quickest.

Sony really needs to money hat Monster Hunter or else it's gonna have trouble selling decently. FF has seen declining sales, and I don't see any other heavy hitters announced for it yet.

There's little hope that the PS4 will save the console market in Japan...

FF XV and Kingdom Hearts 3 might help, but those series have been so poorly managed since the PS2 days, I don't know how much that will help

Others in the thread have said it, but the fact that games like Lightning Returns, FFX|X-2HD, KH 2.5HD and Persona 5 (probably more) are all coming to the PS3 should probably tell you what to expect

I know there is a new Yakuza game coming, but some Japanese RPGs for the system are really needed

ps4 will do fine enough in japan but i'm pretty sure gen 8 will continue the declining trajectory of home consoles in japan.

While sales have dropped somewhat in Japan, things arent really as bad as people make them out to be. About 24 Million home consoles have been sold in Japan this gen with Wii, PS3 and 360 compared to about 27.5 Million of PS2, Gamecube and Xbox. We can probably expect the Wii gen total to top 25 Million when all is said and done which would only be a ~2.5 Million drop Gen over Gen in the face of the handheld explosion and mobile/browser craze.

The only difference between the Wii generation and the PS2 generation is the split. PS2 held most of the market with a lead of ~19 Million over Gamecube while PS3 and Wii are gonna end up fairly even with ~2 Million between them.

Over 20 Million consoles will be sold in Japan this generation.

Given that Japan is the biggest market for mobile gaming, I really really doubt the PS4 or any other home console will renew any console spirit in Japan. I mean Outside of Nintendo and Sony who needs to sell consoles, why would SE, Konami, Gung Ho, Namco and the others focus on making games for home consoles that will not likely sell more than 500k lifetime? Mobiles and Handheld (to a lower extend) are the future in Japan.