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Mr Khan said:

All it will mean is fewer new IPs, and scaling back of 2nd-string franchises. EA, TakeTwo, THQ, and Midway said it. The failures of the year were stuff like Burnout Paradise, Dead Space, and Mirror's Edge (remember, EA projected 3 million 1st-year sales for Mirror's Edge)

 

The big-name stuff will stay, but you're not going to see oversaturation of big-budget titles like you did this holiday season

In general I agree with what you're saying, but I wouldn't include Dead Space in the list of failures.  So far it's at 1.24 M on both platforms, and by gen's end will probably have sold over a million on each individually.