pre-WoW, Blizzard only had around 3 teams:
- One dealing with Warcraft 3 (which went on to develop SC2)
- One with World of Warcraft
- Blizzard North (which dealt with Diablo), and didn't release anything.

So Blizzard really only had 2 working teams just before WoW's release. It was after World of Warcraft came out that Blizzard upped the number of teams, which currently stands at 4:
- Team with World of Warcraft: Wrath of the Lich King, and WoW stuff
- Team with Starcraft 2
- Team with Diablo 3
- Team with unannounced MMO

If anything, WoW brought more development into Blizzard, not less. Now, the expect schedule of future Blizzard releases should be like:
2008 - World of Warcraft: Wrath of the Lich King
2009 - Starcraft II
2010 - Diablo III , Starcrat II Expansion , WoW Expansion
2011 - Unannounced MMO , Diablo III Expansion

Doesn't seem bad, right?

In a funny turn of events, the two studios founded by most of the people that left Blizzard North mid-development of Diablo 3 layed of most of their staffs this year.
The same year Blizzard finally showed Diablo 3 to the public for the first time.

I guess those guys weren't as key or good as they thought back then :P

True, as I had said in my original post at least I think I said we are going to be having a lot of games coming out from them soon but this is the first time there has ever really been a large gap in the release of games.

It could be partly because it takes much longer to develop games now-a-days... at least a game like Diablo 3 I'd imagine it would take much longer. Diablo 3 was announced almost if not more than 3 years ago.

That, and that Blizzard loves to cancel games. They cancelled 2 announced games (Starcraft Ghost and that Warcraft adventure game), they also cancelled the Diablo 3 that Blizzard North was making (and then disbanded Blizzard North), and who knows what else they cancelled.

Is this a joke?  I'm pretty sure all of Blizzard's games have sold more than any of the Halo games have and on PC you don't need to buy a stupid license for the console and it's easier to develop for PC.  This is a large reason why Blizzard has remained PC only.

That's not exactly correct.

Blizzard had issues with the version of Diablo 3 being developped and the people at Blizzard North disagreed so strongly they left the company to form 2 others companies ( that are now dead or dying..).

Once over 30 developers had left, Blizzard didn't have much choice but close the studio and scratch the work already done on Diablo 3....

It's hard to say what were the real issues without having been involved but retroactively you can probably say the people at Blizzard North should have been a little more humble and have listened to Blizzard ( leaving the company with the best track record for game quality to go develop a buggy PoS like Hellgate London isn't exactly what I could call a good choice)...

yup. Good call.

Arena Net is no where close to dead or dieing.

 I was speaking of Flagship Studios and Castaway Entertainment which is where most of the key Blizzard North employees went.

http://en.wikipedia.org/wiki/Blizzard_North  for reference.

Not sure what the connection between Arena net and Blizzard North is or would be.