Its pretty much on the ball as far as 'mainstream development' goes. Personally, I'm dubious about articles such as these - they perpetuate the myth that there is only the one path to follow, the one where the Publisher holds all the cards.
Gamasutra is the big-companies' lacky, usually. Fair enough - they depend almost entirely on advertising revenue for their existence (I haven't the figures to hand on how many free copies of GD mag they give away, but IIRC it's a lot). You just have to read everything from them with that in mind...
I get the same feeling about the 'you need teams of 40 people to write a game these days'. We had teams of up to 40 people, and 90% of the work in the final game was done by about 5 of them. The rest could have been replaced by empty chairs and we would have shipped the same product for a fraction of the cost.
Peter Molyneux famously agrees with you - one of the founding aims of Lionhead was to keep the staff as small as possible (IIRC he wanted it around 10 if possible?). But then, he's also famous for being a poor team-worker, and employing the "surgical team" development model - which ensures he's never able to run larger teams anyway.
Don't believe everything you read on these lines - the industry was started by kids in their bedrooms, and it will be perpetuated by kids in their bedrooms. (Go for it all you budding Java developers out there!) 'Doom' was not published by any publisher - it was a shareware game. Now look at Id.
I agree with your point, but Doom's a bad example.
Doom, like Lineage: The Blood Pledge, owes it's massive commercial success to a canny distributor/publisher/etc (for Doom: Apogee, for Lineage: some nameless internet-cafe owner). Yes, Doom did wonders via Shareware; no, it wasn't their idea, it was the publisher's (IIRC - feel free to beat me over the head if I'm wrong
It's always interesting to note that Doom is still id's biggest commercial success
. Even though the market is now much bigger, no id product since has shipped so many copies...(although id is no longer quite so open about numbers, I still have notes taken from when they put useful info on their corporate website)