In an interview with GamesTM, PixelJunk creator Dylan Cuthbert has pinned Japan's decline in cutting edge game technology on its consumers, not its developers

"No viable business is going to fund expensive technology research if it simply isn’t what’s being demanded by the market," said Cuthbert. "They aren’t interested in the ultra-realistic direction Western games are going. Japanese gamers prefer a bit more of an abstract buffer to go in between, to make the reality less harsh. This all creates a feedback loop that steadily steers game development in Japan away from what is ‘expected’ of it in the West.”

But Cuthbert went on to say that the technological disparity between Japanese and Western games doesn't necessarily mean that the quality of Japan's games are in decline.

“A lot of the titles produced in Japan are perhaps A or AA only in technical quality, but as games they are arguably more polished and fun than the equivalent AA or ‘regular’ titles in the West," he said. There is definitely a gap at the very top in technology, but that top position can only be held by certain-sized teams and for certain types of games anyway. Metal Gear Solid 4 kind of proved that the technology doesn’t have to be bleeding-edge for the game to be well received.”

For GamesTM's full investigation into the current state of the Japanese games industry check out issue 81 of GamesTM, on sale next month.