Korea thinks of computer games as a sport.
The top StarCraft players are considered celebrities.

I've noticed a few major differences between people here in Tokyo vs. in Toronto where I used to live.

1. Japanese play old video games. It seems like many game stores and even used book stores carry consoles and games from Famicom, Dreamcast, Saturn, Super Famicom, PS1 etc. Third-party Famicom 'clone' consoles are easily bought and will play all your old carts.
2. There doesn't seem to be a clear line drawn between 'casual' and 'core' gamers. I've met some self-described non-gamers who then go on to say that they "only" play Dragon Quest and Final Fantasy.
3. 3D is not as interesting. I don't mean to say that Japanese are offended by polygons.. what I mean is that a free-roaming adventure like Super Mario Galaxy or Grand Theft Auto is not so interesting to them. There are some exceptions like Biohazard, but the general reaction I get when showing off a 3D game to them is they say "it looks difficult" and they are not interested to play (they are very happy to sit and watch me play however).
4. HD is not interesting. Most Tokyoites I know have a 13" tube TV and they don't watch it that often. They would much rather play Minna no Golf on PS1 or PSP than on PS3.

well they do call it the country of video games

PC gaming is huge in America and Europe, but not that popular in Japan outside of flash games and what amounts to homebrew.

@Jyona

>> 2. There doesn't seem to be a clear line drawn between 'casual' and 'core' gamers.

Well, this more or less also applies to other countries where a lot of PS2 owners played only a few games such as GTA. The Japanese counterpart just play different titles such as DQ.

If there's anything special about Japan that makes the demarcation a little blurrier, I think it is the abundance of Kawaii in game design. In the West core games tend to be explicitly bloodier and more real, whereas in Japan almost everything is influenced by the idea of Kawaii - hence looks cuter and more casual regardless of game's "core-ness".

>> 3. 3D is not as interesting.

This is indeed partly due to, as you mentioned, the perceived difficulty of 3D games.

Japanese gamers generally require a lot of tutorial, user-friendly features, and easy-feel to get into game (on the flip side this is one of the major reasons why western games haven't succeeded much over there). 3D design makes learning curve steeper and therefore perplexes many of these easy-going gamers.

Their aversion to 3D, or more generally, the aversion to complexity in game design contributed to the gamer's drift (game banare) during the 90s and the early 00s when publishers focused too much on big complex 3D games, which eventually led to the dominance of handheld and Iwata's direction of audience expansion.

Other than complexity, another decisive factor is the prevalence of motion sickness. Japanese gamers are definitely more susceptible to this problem than Western gamers are.

Why? I don't know. I need to ask gene researchers.