Lately, several gaming bigwigs in Japan have shown growing concern that the West is outstripping development from their end.

Square Enix to the rescue! Squeenix prez Yoichi Wada suggested at TGS 2008 that to remain competitive against Western companies, gaming companies in Japan should consider forming an alliance:

We should consider some sort of 'Japan Alliance'. Individuality is important. It's not forcing everything into a single corporate brand. The ideal is a holding company under which several companies and brands can hang.

Perhaps Square Enix's previous attempt to acquire Tecmo can be seen as a practical application of this strategy.

Perhaps studios in Japan should seriously consider this idea, seeing as the US-based ESA has gone down the dumps lately, what with E3's more-than-lacking performance this year. If Japanese studios can one-up ESA, that will surely drive the point home that they're serious about being competitive.

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Opinions from bigwigs:

• Ryan Payton: Japan's no longer the center of video game development
• Sony's Yoshida agrees: Japan lagging in video game technology race