If we have 'regional' servers, a noticable portion of people will choose their server based on the region. This means there will be less 'international' people per server. This has some noticeable impacts:

-- Less economic activities during quiet periods (you put items up for sale at bed time, nothing may sell till next evening, as your whole server goes to bed at same time).
-- Less people during 'off' hours (if you are on EU server but want to play during day you may find no one to play with)
-- Less global feeling (if you enjoy spending time with people who are not in your region you may miss out on this. This is very good for those who do not live in the region they are originally from (i.e. Brit living in US for a while)).

This is a lot to 'sacrifice' for less latency. Perhaps they can come up with better solution?

-- Regional 'proxy' servers that have better/dedicated/optimized link to main servers?

I.e.: Connect to 'proxy' server in Germany which has a dedicated link to the real server in Japan

-- Remove timing based on server calculation in favour of client calculation?

You move away from Ifrit's cracks when you see them on your screen, not when the server in japan says they are up.