Gamasutra: The game development landscape is changing rapidly. We're almost going back to a time that we thought we'd never see again, a time when a couple of programmers and a couple of artists could get together and make a game. This has been made possible by new technologies like the iPhone, Facebook and XBLA among others.
Startups with 3-10 members are cropping up all over the place to take advantage of these technologies, and some of them are doing extremely well. However it is an increasingly crowded marketplace, and only a few will actually succeed in the short-term, and far fewer will see long term success. The iPhone simply cannot sustain the shear number of developers who think that they have the killer game app.