Oh well, I think I have to disagree with the article there. The Japanese may have different tastes than the western audience, but there definitely is a huge amount of effort spent on just how the phones look. There are cool design choices (like the swivel screen mentioned in the article), boring ones (dozens of different color casings), and a huge amount of after-market customization paraphenelia (stickers, "jewellery", straps, etc.) available. Some cell phone stores and craft stores have prominent displays showing off ridiculously overdone pimped phones covered in gleaming stickers.
What I meant to say earlier was that this look could appeal to some people in the west too. Some people just want something that looks different than the iphone or razr. I know my wife loved the cute pink clamshell phone she had in Japan (that I spent days trying to jailbreak afterwards).
And that is, according to this article, exactly their problem: the Japanese are just too focussed on features.