This article presents a fascinating way to view the handling of narratives in games. Games' are inherently a second person medium, though the stories they tell are almost exclusively third and/or first person stories strung together with gameplay. This contradiction is how we end up with many of the challenges to developing a sophisticated narrative in a game. Look at the Metal Gear Solid games, which tell most of their stories through third person cinematics, limiting the degree to which they utilize the unique perspective of games. Even though MGS uses those cinematics well, it is stuck with the stigma of being more an interactive movie than a game because it's so tightly bound to third person storytelling. Despite how well some games may use these tools to tell their stories, they are at odds with games' inherent strengths, and will struggle to mature as their own medium the way films and novels have.
This disconnect between essentially linear first and third person stories and the more variable second person medium seems to be source of common criticisms (think Ebert). Games are often criticized for focusing on power fantasies because the player controls the central character who generally "wins" the story's conflict when the player "wins" the game. Since no player wants to "lose" the game, a game designer or writer will have difficulty telling a story in which the protagonist is not ultimately the "winner" and still produce a compelling gameplay experience.
Heavy Rain attempted to solve this problem by redefining "win" as the more open-ended "complete." In order for the player to be placed inside the narrative, the story must react to the player's decisions, which are different for every player and every playthrough. The result is a choose-your-own-adventure story that develops according to how the player solves (or fails to solve) problems in the game. This model introduces some problems, including that some players may end up with a narrative arc that is much "weaker" than others by traditional metrics, but it makes an important step in the right direction. In a game structured this way, the player may fail and the story goes on, avoiding the need for the player, and thus the character he is playing, to win every conflict. This disconnect of perspectives is one of the most important issues for narratives in gaming, and it's good to see some games trying new ways to address the problem. It's a sign that the industry is maturing in a very meaningful way