He seems more concerned about copycat games
Sequels are needed to improve game concepts, however there is also the other sequel, just to make money.
He is right in the economical point of view IMO, that also happens in other industries when some idea is copied to death. It's like spaghetti westerns, they were economically successful at the beginning, then lot of people started to imitate plots and such, and all those movie companies went to bankruptcy.