Basically, major publishers are driving themselves and the gamer toward a crash by making their games far too expensive. Do we really need full motion capture for a FPS where the major motions the models are going to use for most of the game are going to be different ways to fall down after getting shot? Must every Final Fantasy game require facial motion capture to stick realistic faces on impossible hair styles?

One would hope with the next generation games, developers and publishers get smarter. Sadly many Japanese publishers have run into these issues and their industry response has been to revert to mobile devices (built around farming money) or handhelds (which run previous generation hardware they have more experience with). I would hope that developers would learn to temper themselves before they kill their own industry.

ROTFL @ the FF part! Publishers should learn to ask devs for a balanced set of features amongst which spending a defined budget. And developers' own management should learn to build databases and libraries of motion captures and textures and more efficiently reuse previous parts of development work that in HD games are quite expensive, instead from dev costs of new titles one could think they are reinventing the wheel each time. I can understand making title-specific textures, for example, but are they making from scratch tree leaves and barks each time? And can't they reuse previously done motion capture? And face motion capture budget shouldn't be dependent on the amount of close face-to-face characters' interaction in each title? Surely faces are important in games like Heavy Rain, but in stealth games they are a lot less, you rarely want to be face-to-face with NPCs in these games, and the same applies to games with fast action like FPS, where body motion capture is a good feature, but once well done in a title, it should be reused in successive titles, while faces have little importance.

Dyack is a tool, I wouldn't take anything he says too seriously.

Yep, we should learn from Tibetans: thet use da yacks as working, dairy and livestock animals, but they haven't conversation with them.

All hail the Glorious mobile master race!

He is somewhat right in that the middle-ground AAA games have become increasingly costly and risky and publishers have become aware of that. Examples are Dead Space, Crysis, Darksiders, Lost Planet, Dragon's Dogma, Dragon Age, Rage, Deus Ex, Devil May Cry, Homefront and Hitman. These games seldom make any money.

Activision already left that segment entirely after Prototype 2.

Instead the trend is to focus on the really huge titles (COD, BF, GTA, Assassin's Creed, Watch Dogs, Destiny, MGS, Resident Evil, Fallout), or invest like crazy and try to ensure your middle-ground franchices take the step into the big league (Far Cry 3, Borderlands 2, Tomb Raider).

The biggest AAA titles are the cash-cows, and they're not going away, every big publisher is going to continue to invest heavily in these.

But on the other end the middle-ground titles must adapt and try innovative business models or downsize the studios or else they will remain too risky and lose money, and that's where Dyack's point comes in.

It's pretty funny, and ironic in the context of publishers and evolving business models, that he is about to fail his own attempt at a Kickstarter funding a second time.

I'm not surprised. Not only does he have a bad rep of being a con man, but he seems totally out of touch with the gaming market, what his target group is and how successful marketing works.

In the current Kickstarter campaign he is sending a very mixed message by first making big selling points out of the participation of a famous voice actor in Shadow of Eternals, how cinematic the game is and how much they're investing in its musical score, all while he is trying to convince people that it's a really original and community based game.

Some people never learn.

you got it spot on. 

If I could just make a suggestion,

http://hatintime.com/

It's looking really good. It's been greenlit on Steam and successfully kickstarted. I think they are aiming for an early 2014 release.