Yeah, thing is, as others have pointed out, the industry isn't the same place it was when Jaffe started out.
As far as I'm concerned, the problem is a lack of unions. Video gaming is one of the last industries to remain completely un-unionised, and that's had a negative effect on how the industry runs. Every other industry, including other entertainment industries such as music and film, have unions which ensure that workers are being treated fairly. Corporations have so much money that being in a union is the only way to give yourself a chance when it comes to taking legal action for malpractice or exploitation.
Right now, developers have got no-one looking out for them. Ideally, publishers would be mindful of the needs of developers and would ensure they're treated in a fair fashion, but we've seen time and again that this isn't the case. A Game Developer's Union with a full legal team paid for collectively by its members would be a huge boon to anyone looking to challenge publishers for screwing them over. You can bet your sweet arse that Bethesda wouldn't have screwed Obsidian over royalties if there was a chance they'd get attacked by a Union legal team.
Unfortunately, any developer which tries to set up or join a union is a developer which probably won't be getting any work from the big publishers anytime soon. This is where I really wish Valve would step in. They've got the clout and the financial security to be able to set up a developer's union without seeing contract work from triple-A publishers dry up. And as gatekeepers to Steam, and that ever so profitable PC market, they would be in a unique position to 'encourage' other companies to join the union, or to prevent publishers screwing over developers who do join. "Oh, you're blackballing these developers because you don't like the fact they joined the Game Developer's Union? Well, I guess we won't put your big game on our super popular and profitable marketplace then..."
Do it Gabe. For the love of God do it.