The problem is that the industry is spending the money on wrong things - massive marketing, shiny graphics, motion capture for animation ... Unfortunately, most of that is extremely expensive and laborious. I really don't need my next stupid shooter game to have motion captured animations of every monster done by AAA Hollywood mocap specialists at several thousands of $/hour.
And as the "next gen" has to be bigger, better, shinier than the "last gen", the costs spiral out of control. Another consequence of this blockbuster mentality is that only few innovative "AAA" games get made, because nobody wants to take risks with such budgets - but how many times can you redo Doom?
It is possible to make and release games cheaper, even big titles (just look at the Witcher series). The companies and publishers need to start to work smarter, not just pour more money at the problem. However, when the most complex AI in games are finite state machines and motion capture is considered as "AI" (true quote from one major studio exec), every bit of content is hand modelled, textured and baked instead of some sort of automation or more clever game design, when the "next gen" game innovation stops with rendering more nose hair and dirty pores (or bigger boobs) of the main protagonist than the "last gen", then I am really sceptical ...
Oh and cut out the middle men and stop reinventing the wheel for the sake of greed (Origin by EA anyone?). You will cut your expenses by a factor of 2 right there.