This video seems to explain things pretty well.
If true, that's going to a very high barrier for entry, on new servers, to get materia infused gear to progress in end game content. I can't imagine the content being balanced without it, as Legacy servers will just steamroll it, which means new servers will likely still be working on trying to enter that content while new content is being released. Ya, I know some people will say 'Legacy' but it's a pretty tough road for new servers to go down.
XI Wiki



