And the longer the time between episodes, the smaller the chance it would generate new sales because existing users lost interest.

True, but with that particular game what didn’t help either was that there were many years between episodes, it was pretty awful. It’s one thing I really hate about episodic gaming. But Valve already proved it to be a failure, only Telltale And Dontnod still do it (and they do it consistently right, to be fair).

The rest of the gaming industry has gone on to “Early access” which is even more awful. Rather than buying the first part of the story for a lower fee, you now pay top dollar for a game which isn’t even finished and never might be because once you pay them there is no real incentive to actually finish it :)