"Dead" is a massive overstatement if you ask me. More like "grievously wounded if you ask me." If SE cuts off all ties from everything having to do with the XIII series and actually get their console production pipeline in order I think they cam make great Final Fantasies again.
I really disagree with the article's assertion that X-2 is where things started to go bad. I haven't played X-2, but I thought it was very popular, and didn't it sell nearly as well as X (or slightly more)? X-2, XI, and XII were all successes for SE. The problem has been XIII, XIV, and this entire console generation in general.
Like almost every other Japanese developer, SE just can't seem to actually get an HD console game done in a reasonable timeframe. If you look at XIII's postmortem at Gamasutra, it paints a development cycle plagued by aimlessness and technical problems. A big issue is that they weren't able to properly transition to middleware development with the Crystal Tools engine. And then there's how they planned out Fabula Nova Crystalis to be a whole franchise akin to the FFVII spinoffs before XIII was off the ground.
SE also probably intended XIV to bankroll everything else they were doing, and it's been a spectacular failure in planning, just like FNC, which SE has had to salvage with two XIII sequels, one of them with the help of Tri-Ace. Even though XIII was commercially successful, SE should've looked at the fan and critical reaction and dropped the whole FNC idea and just went forward with XV on a clean slate, or better yet, not planned the whole FNC thing in the first place and just let XIII launch as its own game, then see if it was viable as its own franchise.
Hopefully SE sees next gen as a chance to start over and we can just look back at the PS3/360 games as an isolated stumble.
They really better not fuck up XV. I don't think XV is gonna singlehandedly make the franchise as hot as it was during the PlayStation golden years but it can at least restore some confidence. I honestly still see it as Versus XIII but with a new name. That said, we still don't know really WHAT Versus XIII is. I have confidence it's very different from what they've been doing with the other XIII games because it's being worked on by the main Kingdom Hearts team.
And really, SE's handheld games over the past several years show that they are still capable of designing good games. They just seem to have a problem handling the most modern video game tech. Hopefully they can change gears on that.
The one thing I'm actually most interested in from SE is whatever they plan to make on the Luminous Engine. I don't think they've mentioned it at all in regards to XV, which leads me to believe that XV is still using old Crystal Tools tech in conjunction with DirectX 11. What I'm really waiting for is the next major production after that (XVI?) to see if it can look like the Agni's Philosophy trailer.
If SE can deliver that next-gen visual leap with the production values we know them for (even I'll admit XIII looked impressively flashy at first sight), and actually design a good game, I think they can restore confidence in FF.