In his latest "Experienced Points" article for The Escapist, Shamus Young discusses the industry's current trend of churning out video game sequels.
Worse, when the inevitable sequel rolls around the game suddenly has to serve two audiences: The people who played the previous game and those who didn't. Characters have to stop and explain things that everyone already knows for the benefit of the late-comers. So then the writer is trying to tell a tacked-on new story while making sure the audience is up to speed on the old one. It's not impossible, but it adds a lot of narrative cruft.
But videogame sequels can be a good thing. They can build on the gameplay of the original, taking player feedback into account and using their acquired knowledge to make for a richer experience. The story turns to mush as it ages, but the gameplay becomes more polished. Despite the howling of "story is king" people like me, games live or die based on the strength of their gameplay, not the setting, the story, or even the characters. A well-writen story can make a good game into a great one, which is why I'm always insisting that designers need to spend time making the writing less horrible. But if the gameplay sucks and the story is great, then you don't have a game. You have a movie that's a pain in the ass to watch. When I sit down with Thief: Deadly Shadows (which is just the numerically-challenged title for "Thief 3") I think, "Oh boy! More amoral sneaking around in a corrupt world of magic and steamworks," not, "I can't wait to see what Garret is up to these days." Nothing against Garret. He's a great character and all, but you could make a good Thief game without him. You couldn't make one without the sneaking around in the shadows stuff.
I think the Final Fantasy series has nailed what makes a videogame sequel work: Find the elements that define the experience for the player and keep those, but wipe everything else clean. There's no need to drag the same group of teens from one adventure to the next, repeatedly saving the world from an infinitely respawning league of evil dudes and their ceaseless cataclysm generator. We get a new world, a new disaster, and a new slate of characters to meet. They might crib some elements and character ideas from earlier games, but you can jump into the series anywhere without needing to worry about what has come before.