NJ5 said: Sony's money only stretches so far...
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Because Phil Harrison was very very keen on the whole "community" aspect of games, and really pushed very hard for games that enhanced that. As you can see, the Singstore for Singstar really pushes that, as does LBP and the user created levels thing.
And as they mention the games they are working on now, four out of five of them were decidedly casual. I do imagine that part of it does have to do with Killzone 2, in terms of resources, but it's moreso the fact that they are, at least for the time being, dabbling into more casual things, as they feel that's what's going to help them in the long run.
I don't believe Eight Days and Getaway 3 are cancelled for good, as they already were in pre-production, I think that SCEA may have picked up one, or both of the titles, since they both had already been started on.