Keiji Inafune, the creator of Megaman, recently quit Capcom in a high risk attempt to change it. His thoughts (link to Gamasutra verified interview that had been translated and posted to a message board) are that with the life-time employment that Japanese companies offer, the employees have less reason to try to be competitive. Producers get no credit if the game does well, but take all the blame if the game fails. Designers like him have less reason to risk failure with a new idea. Instead they have stagnated, while in the West, games are thriving.
But, all I keep reading about in the west is how companies lay-off employees at the end of game cycles, resulting in 1/3 of all game designers being unemployed. Inafune though, points out that these designers are instead making their own studios and following the Indie route. This path apparently, is almost non-existent in Japan.
In the West, Indie developers can make downloadable games for X-box360, Playstation 3, Wii, DSi, iPhone, Andriod, Steam and other platforms (upcoming Ubuntu Download Center, and the Mac App store for the MacOSX).
So, will Capcom fail, or will their structure remain intact for the duration of the downturn? Will they be forced to restructure, resulting in up to 300 employee layoffs (estimates by Inafune)?
Update: They are taking a third route, restructuring while trying to keep all employees. Looks like his voice just took time to take effect? Or perhaps the very public interview he did, got to them.