Joystiq- If you want to know where Xenoblade Chronicles came from, you need only look toward two sources. There's Monster Hunter, which is the inspiration for seemingly every modern JRPG from Dragon Quest IX to more blatant knockoffs like God Eater. And there are MMORPGs, which have come to exercise a great deal of influence over Japanese gaming culture as a whole.
Xenoblade Chronicles, and Monster Hunter too, are like this for a reason. Work and school start early and end late in Japan, and any time at home is usually either devoted to the family, or sleeping. Many gamers have migrated to manga cafes, which have been dominated by MMORPGs like Lineage for about a decade now. MMOs have in turn influenced loot-centric cooperative handheld games like Monster Hunter, which serve as the other alternative for busy students and salarymen.
This trend presents a dilemma for Japanese developers. Japan simply can't get enough Monster Hunter and its ilk, which is all the more reason for developers to keep cranking them out. Global audiences, however, have been slow to embrace co-op RPGs. That's where Xenoblade Chronicles comes in – an RPG with all the trappings of an MMO or a Monster Hunter, but wrapped in a traditional, single-player JRPG.