Some ideas work well to serialize as sequels, others do not, and even those that do serialize, they usually have a limited lifetime over which it makes sense to do so. The problem that I see is that game developers are getting to the point where they are writing a Piers Anthony series; the story ended after the first, second, or third book, yet the series continues to drag on for 3-4 more books. The trick is knowing when it's time to stop and come up with something new.
Even so being, I do wonder about the concept of episodic gaming. Granted this flies in the face of the author's complaint about cliff-hanger endings, but the intent is not to simply bilk the market for cash; rather the intent is to allow the creation of ever larger, highly detailed game worlds while allowing the developer to better control cost and risk. Of course, this requires the gamer to understand going into the game that he is not supposed to see a completely conclusive ending until some later point.
In my opinion, the current model of a singular effort to create a singular, monolithic epic game has reached the limits of applicability to create compelling gaming experiences for current gamers. Basically, a game developer only has so many resources available over a given time period, so only just so much can be done. Segmenting the game into episodes can help the developer create a focused, detailed experience at each episode because the entirety of the game world does not have to be created all at once. Instead, the developer can reveal the world in expanding layers that only have to be created when needed. Also, the developer can develop the game and its world only as far as the market supports, rather than having to bet-the-farm with every game. This can help the developer better control the cost and risk of creating extremely large game worlds.
Of course, episodic gaming does not work with every game, but it may work with a number of games, particularly RPGs.