Lost Planet 2 producer Jun Takeuchi has said that the Japanese games industry needs to evolve in order to have a "hope in hell" of catching up with the West.
Speaking to Xbox World 360 (reported by CVG) Takeuchi said: "If the Japanese games industry doesn't evolve and simply maintains its current status quo, I really don't think we have a hope in hell."
"Drastically innovative ideas are needed - and quickly - to equal or exceed the Western games industry," he added.
His comments followed those of Capcom president Haruhiro Tsujimota who - speaking to the Financial Times - restated Capcom's stance on working with western-based developers following the poor performances of Airtight's Dark Void and GRIN's Bionic Commando last year.
"As a group, the new titles where development was led from abroad didn't do so well," he said.
The company now plans to create new IPs locally and only use overseas developers for sequels and ports.
He added that he was yet to see Nintendo's 3DS, but that he was "interested" in the handheld, and expressed his view that Microsoft and Sony needed to be open about their motion controller business models in order for them to succeed.
"If there isn't a strong business model message from the platform holders about how they will develop [motion controllers] with users, then I don't think it will go well," he said.