I didn't say JRPGs did I? Square and Enix are to of the original founders of video game role playing as a whole, you'd think they'd try to carry the worldwide mantle. I find their slow uptake of player choice in RPGs offered in many western developed RPGs just as weak as their fan fiction quality plot writting, mindless game mechanics, and diminishing depth/rewards for exploration.
Bethesda and Bioware have done more for the RPG genre in the last generation of consoles than SE did, and Bioware was making some of the worst games in their history (BG2 kicks KOTOR's ass). Japanese developers were piling on with the ass kicking though, as Nippon Ichi has dominated SRPGs, Atlus is doing a lot to bring new concepts to RPG storytelling, Capcom made the single most innovative RPG in the last ten years BAR NONE (BOFV is GREAT), etc..
Now Mistwalker is on the scene and looks to be a direct usurper to SE's last remaining crown, unbeatable production values.
I can't wait for FFXII because it promises to bring something new to a worn out franchise. But SE's games have yet to match the gaming impact moments like first flying to the moon in FFIV or seeing the world ripped apart in FFVI did over a decade ago. Last generation Square delivered some interesting non-RPG and hybrid RPG content in Einhander, FFT, VS, Brave Fencer, Tobal (no.2 was the best fighting game of last generation), and Bushido Blade, but now they've even left those by the wayside. Enix made some interesting non-RPG content earlier this generation as well, like R.A.D., but as far as new advancements to their RPG games? They've been largely reactionary and behind the curve since Sakaguchi stopped making games and became an overseer. The only good things that come out of SE at this point are from Horii or Kitase, and they can only make so many games a year. Nomura and Kawazu will continue to turn out their shit at alarming rates though.