Without a shadow of a doubt, the level of innovation in the gaming industry has plummeted massively, to the point that the best selling games are generic war shooters that come out on a yearly basis. Companies like EA and Activision have become so big, that taking a risk is too much of a risk. I was not expecting EA to announce Mirror's Edge using the FrostBite Engine 3 as well as being an open world game. As happy as I am about it, it's obvious that this was a lucky break for ME fans. If they didn't show the amount of demand for a sequel, there is no way in hell that EA would let DICE create that game with the scale it's going to be on. The really innovative stuff now comes from the indie devs, the ones with a very limited budget to spend on a game, yet reach success to the highest order. Prime example? Minecraft. A game with graphics worse than the early games that came out of the N64, but has sold massively and is still being played frequently to this day. Indies have shown a lot of innovative ideas and try to separate themselves from the status quo, which has been rewarded in some way.
The most recent example of this is none other than Mighty No.9, a game from a Japanese company called Comcept. Many of the people involved with the project are former employees of Capcom a Japanese gaming company who molded many people (including myself) into the sort of gamer they are today, but only have 152 million in the bank. The thing with the Japanese industry right now is that they've been putting games with massive potential on mobile devices, which could very well be realised at a much larger scale on consoles or even handhelds. Keiji Inafune separated himself from that and is now putting Mighty No.9 on basically everything apart from smartphones and did it all through a Kickstarter.
More than ever, the main investment that most
publishers are making for their games are good
graphics and while I do like good graphics, they do not matter as much as gameplay by any means. Now with some companies, we get both, but from others, it's about making a game look pretty but play like a bumpy road. A huge focus on graphics has also killed a lot of studios off the generation (I think about 150 notable studios this gen). Example: Team Bondi. They succeeded in making a huge world with amazing detail and mocap, but the end result cost them their studio. I like my good textures. I like my good animations. But I'm not gonna cry if I can't see the nose hairs on a character model. While most console gamers have this mentality, the mainstream media will judge a game completely off of it's graphics.
The hype machine annoys me to no end. GTA5 is an example of a game that has such as huge hype
machine behind it. We didn't even see any gameplay for the first 2 years and that game was probably the most anticipated for the gen. It was a well crafted game, but the hype machine made it seem so much better than it actually was. Also, as for whether the industry is going to crash... well that's for you to decide. Personally, I think that the industry is too big to crash. I can see company after company failing and becoming the next Konami's but not a full on gaming crash.