The regenerative cycle of modders coming and going means that few begrudge such commercial interest, even if it hampers or even threatens ambitious projects like Warm Gun and Airborn (pictured on p81). Games and their mods inhabit the same ecosystem, after all, if not the same shelves. The fate of outfits like Trauma Studios, however, the team behind Battlefield 1942 mod Desert Combat, has raised ethical concerns which are far from unique in the industry overall.-- The State Of The Mod [Next Gen]
The "ethical concerns" are discussed a bit and somewhat dismissed in the full article - and I think that's fair. I think the industry is pretty honest with the mod community for the most part, but it doesn't change the fact that said community has become something of a feeding pool for a ravenous crowds. I think it's quite telling that the article has nothing but screenshots of interesting maps, concept designs, and otherwise artistic mod efforts - but the fact remains that these efforts are the true dying breed.
Mods, in general, will never die because portions of the industry have become to accustomed to them or have too many ties into the mod community in general. The loop now, though, is about developing young talent to be either implement free content or fill upcoming professional ranks. The same industry pressure, though, means that experimentation with genres and gameplay is risky and nearly impossible to attract the same kind of team that would be required to make a full game.
Don't get me wrong - innovation exists and it's not like new blood doesn't inherently bring new ideas ... but it's not the same kind of innovation that small teams (or individuals) used to be able to garner any attention for ... the kind of innovation which brought us Capture The Flag, Counter-Strike and more.