NowGamer has an article up in which they ask various game developers what the biggest problem of the game industry is. Quite a lot of them reply with variations of the same answer: Players say they want innovation, but then rather buy sequels than innovative games.
Quote from Josh Olin: "Too many developers who try new things are getting burned by “pundits” and angry entitled fans who look to be contrarian, sometimes simply for the sake of being contrarian."
Justin Richmond: "I think it’s hard to innovate and make money, which is the same in most industries. Right now the public is rewarding building franchises like we just talked about."
Paul Cuisset: "If you have the feeling of playing the same game year after year, it’s because there’s not much room left for games with a title that doesn’t end with a number."
Atsushi Inaba: "I think the biggest issue is that there is a definite sense that we can’t challenge new things anymore. There has been a sudden rise in development costs, which has made it incredibly difficult for game makers to try their hand at new things."
Now some players blame the devs for not being more innovative, but from the blog comments here I have first-hand experience of how hostile players can get towards any new idea. I think it has to do with the wide-spread attitude in which people take games way too serious, where they regard their achievements and standing in some video game as more important than real life. People who believe they excel at some game would rather have a boring sequel with few changes, so they are sure they'll be good at the new game too, than a completely new and innovative game in which they'd be "noobs" again.
In the end for a game company players are customers, and customers always get what they are most willing to pay for. Thus we end up with a choice between sequels and "new" games that are knock-offs of successful competitor's games. Because this is what are the guaranteed successes. There are actually quite a lot of innovative games out there, but usually very few people buy those. It is rare that some game comes along which is both innovative and successful. And then it is made into sequels and knock-offs.
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