I think XVI is closer along than we think and Square Enix has learned its lesson not to announce such projects years in advance. Like, I could legit see a 2020 announcement and 2021 release, but I'm an optimist.
I agree.
This idea that FFXVI has to be many years away doesn't make any sense to me. Even with the crisis of having to redevelop FFXIV (while still struggling with HD development, while still developing an engine), Square Enix has never gone more than about six years between releasing new numbered Final Fantasy installments. I don't see the development of the FFVII remake by another team to be nearly as damaging as the company-wide crisis that was salvaging FFXIV.
Square Enix has to release games. They have FFVII and Avengers in their 2020-2021 fiscal year now. They have to have something planned for their 2021-2022 fiscal year. Maybe FFVII-2 will sneak in just under the wire and be a March 2022 release, but that seems risky to rely on. It doesn't seem that a Dragon Quest or Kingdom Hearts will be ready that soon. On the other hand, we know they've had a team working on a new FF for some time.
Also, Square Enix has a good relationship with Sony, and they like to reveal new Final Fantasy games alongside the reveal of a new PlayStation. This works for both parties: Sony gets a big reveal and Square Enix gets people to start buying the new PlayStation early, so that the install base is there when they do release their new game. I wouldn't be surprised at all if there's a planned FFXVI reveal at the big PS5 blow-out.
Keep in mind that the original plan was for Square Enix to have no major unreleased projects by the time E3 came around in June. The Avengers delay pushes it past that, but they'll still have basically a clear slate as far as being ready to announce their new projects.
I remember people still thinking FFVII was years and years away until they announced the spring 2020 release last year, too.
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