>>35257627Drop in popularity = kill the craze.
GSC by its very concept tried to ride the craze as much as they could. It's the only gen that's an actual sequel in story, world design, and mon design. It was marketed as such and everything about gen 2 was designed to keep on riding the wave of gen 1.
Gen 3 was very good, but it was a radical departure in all respects (new world, unrelated story and characters), you couldn't even physically catch 'em all without having another game on a console and jumping through all kinds of convoluted hoops that didn't even mean you would actually catch them all. Such a radical departure seems meaningless now but it meant Gen 3 didn't appeal to fans of the craze, only fans of the actual game, and it did kill the craze because of it.
Everyone seems to assume that I'm saying that Gen 2 was the summit of the craze, and it wasn't, but it did reignite it a bit and kept it alive due to its sequel status.