Well, as I've said before, there is no excuse for the size and pay scale of some of these development teams, the entire thing seems bloated beyond belief. What's more it seems to size of these teams ironically increase with technology coming out that should by definition be making things easier. Not to mention that from the way things seem at E3 they are basically hyping the ability to pay people to model convincing arm hair.....
At the end of the day if Cliffy B's predictions come true, it's pretty much going to kill gaming, or seriously hurt it. Games are very expensive, no matter how much you argue about the "value for the dollar" (which everyone producing a product says). Raise the price, and it will just become a pastime for the rich, and you'll see less sales overall. Right now it's difficult to continue gaming seriously as it is, and the economy hardly seems to be improving by leaps and bounds. The microtransaction systems and such also seem to largely be fueled by greed more than anything, with people fueling them because right now it's a choice of tolerate them or go without gaming... but as things progress I think more and more people are going to choose to go without the games. To be blunt I liked the "Dead Space" series, but when "Dead Space 3" included a microtransaction system I chose not to buy it and haven't looked back.
I think Cliffy is mostly speaking from the perspective of what the industry wants, and is going to try and force. On some levels I suppose looking at the trends he might be right, as gamers have generally caved to every greedy scheme the industry has shoveled on them. We're ultimately responsible for tolerating the Day #1 DLC, on disc DLC, DRM schemes, and these ridiculous, bloated design teams and their costs. We keep buying the products, and giving our money, so of course the industry pushes harder and harder.
Also, when I talk about ridiculous, bloated design teams, understand that I'm not just talking about my usual rants here. Consider that with games like say "The Old Republic Online" on which an astronomical amount of money was spent, the guys doing the modeling couldn't even solve the problem of character models clipping all over the place. You wear a cape or a cloak, which tons of outfits involve, and you can literally see it clip through vehicles you sit on like a semi-intangible dishrag. My smuggler wearing a suit of armor with a duster/long coat over it (visually) has her gun clip through the coat on the gun belt. To go one further, I don't think I've seen one MMO in recent memory that hasn't had these problems, heck in Neverwinter they will let you play a Halfling "Great Weapon Fighter" and your sword will literally clip into the ground half the time as you run because nobody could be bothered to hang the swords a little different for the small models. Don't even get me started on collar and long hair combinations, or whatever else. At the end of the day you have all these hundreds or thousands of people being hired to do art assets and models (which is where that money is going) and spending millions upon millions of dollars, and then producing what amounts to visual garbage with the current technology... and demanding to be paid top dollar for it. This kind of thing is a typical problem with things that become too big and bloated, you've probably got ten times as many people as you need working on a project, so nobody feels motivated to do anything to check anything, they sit around sucking up money, rush the product out at the last minute, with a bloated budget and a crappy result. While I mostly talk about MMOs here it also applies to single player games. A lot of it also probably comes from say hiring one team to do hairstyles and another team to do costume options, and then never having them talk to each other to compare their work...
My basic point here is that Cliffy seems to be trying to make a pseudo-common sense argument about design teams to justify the worst financial excesses of the industry and their plans for the future, while not considering that for the most part these guys don't even seem to get the job done as it is. The industry needs more efficiency, not stuffing more clowns into the car, and needs to do more with less, not engage in Caligula-like excess on hiring resources and then pass the cost on to the consumer.
At any rate, I really "look forward to" this upcoming generation where they will doubtlessly be hiring expert armhair modelers, tacking them onto every design team, and then we can see the fine hairs on peoples arms clip through their clothing, by way of showing off awesome next generation graphics technology.