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the main problem with a FF7-2 is that FF7 is a PS1 game, and FF7-2 would need to be a PS2 game. Square are lazy. FFX-2 was effectivly just a cheap cash-in, as they could effectivly utilise the FFX engine without much change. FF7-2 on the FFX engine would require a fair bit of work to feel "right" in respect to the styles of FF7, and they'll never develop an entirely new game engine to accomodate a FF7 sequel (far too much work). my guess is that it'll never happen.
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True... But I wouldn't say they are that lazy. They should know how much they could cash in on a FF7-2. They are no longer in financial problems so the only problem they really have is a ton of projects they are working on. You got FFXI and FFXII due out in the next 1-3 years and I am sure they will get started on FFXIII for the ps3 soon. Not to mention the games for GBA and GC. Maybe they could make a remake of FF7 so they could cash in twice as much.
Not that I really want to see a FF7-2. I liked how there were no sequels. I mean...who would be the villain? Nothing will live up to Sephiroth.