I think he is close, but missed it by a hair.
I don't think they they are got afraid that what they do is no longer going to sell, as much as they all wanted to be making the things that makes the most money.
Like what he mentioned about single player games no longer sell. Of course everyone knew that single player games still sell, they just knew that multiplayer games are so much easier to make and make so much more money.
They noticed that they can spend 4 years crafting an excellent single player game, at the cost of 10 million dollars that people will spend 40 hours playing and you will sell maybe 20 million worth, then start over and do it all again. Not a bad proposition, that is until you see CompanyX spent a year making War FPS Clone #123, spending approximately 200 dollars for some Chinese programmers to modify War FPS Close #50 engine, and to pay Jethro the Janitor to cough out some dialog they wrote on the back of some lightly used toilet paper, and people line up a week ahead of time to get it first, play it on average for 10,000 hours (until War FPS Clone #124 comes out in 12 months) and ComanyX makes approximately a trillion dollars on it, then they start to produce DLC.
Right about then they started to think that their large breasted survival horror heroine just might have to fight a war with 8-12 of her best friends in their next installment of (no longer) single player game.