Modes of Game Development

There are a few different ways to make video games rather than the Rockstar way. The first is;
The "Tent Pole" Business model-  This has the concept that the publisher releases one "Blockbuster" game accompanied with heavy marketing and investment. Then the money made from this game supports the development of other "riskier", potentially more creative games. For example Grand Theft Auto brings in a lot of money for Rockstar which allows them to invest smaller hits. Also EA rely on their "blockbuster" hits, Fifa and Madden to create cash for the research and development of other games. ($372 million was spent on research and development).
However there are some problems involved with this mode of development. For example the companies are gambling on that one game being a huge hit/success and sometimes even big games don't return- the money. A prime situation was Spore, created by EA, sold 1 million copies in it's first 17 days, but the development costs were so big that EA only expect to make their money back with 5 years of updates and sequels.
The Hollywood Model- This idea is to contract out parts of the games design (art, car physics, assurance etc.) to other companies in order to lower development costs. So, instead of having a permanent 'in-house' team of 50+ people, the developer can have a team of just 10-20 piecing the work together undertaken by specialist external teams.
Independent Game Development- Until recently, creating games was a very expensive business, usually requiring a publishing contract in order to pay for development and a license fee required to develop the game for a particular console. However, more recently, the 'Indie Game' market have grown. Open source software's such as Apple's App store and Xbox Live Marketplace have allowed small teams and even individuals to create games and get them distributed to make money. New technology, convergence and new ways of distribution means that more abstract games are now being developed.