I mean, personally it just feels like there’s too many games. And consequently too many game studios.
On top of that, the cleft between the production value of a triple-A game and anything not that is gotten so big that the moment you aren’t some Call of Duty or Dragon Age or something, you might as well be a 1-person hobby project that as a result has no need to keep making money as it can trivially just go at whatever pace it wants. Add that it’s not uncommon to make the vast majority of your money via an unfinished game that you can then leave unfinished so you can reduce costs while making most of the money, and you got a recipe for disaster for any A or AA development studios wanting to scrape by.
You basically got to have your own little reliable niche, while also being lean enough so you can make games with extremely little cost per game. Hence everyone turning to mobile, where exactly that MO has become established.