The original M-2 design only accommodated six infantry but by popular demand that was increased to seven. In practice the four M-2s in a mechanized infantry platoon went into action with two squads split between the four vehicles. The infantry never liked this and want a larger M-2 replacement to keep the squad together.
The debate over the optimal size of the infantry squad is a recent development, as is the squad itself. All this began nearly a century ago with the appearance of the infantry squad. This was truly a 20th century development, even though the original squad size fighting organization was the hunting party that was turned to wartime use. The Germans were the first to introduce the infantry squad as an independent combat unit in modern times. This happened when the Germans perfected their "Stosstruppen" (storm troopers) tactics in 1917. After that, the infantry squad was no longer an administrative unit but became a more independent and effective combat organization in all the world's armies. This changed infantry combat dramatically, but the significance of the change was rarely noted.
Early on the squad was meant to be organized around one or more automatic rifles or portable machine-guns. Many nations quickly went on to organizing the squad around two automatic weapons so they could use “fire and maneuver” (one fire team providing cover fire while the other one moves). The U.S. only adopted the idea of two such automatic weapons during the Korean War (1950-53) when it became obvious this was the way to go. By the 1970s the army had decided to use 11 man squads for light (no armored vehicles) infantry and nine men for those using the M-2 or other vehicles. The marines continued using three fire teams per 13 man squad.
The U.S. introduced the M249 in the early 1980s, specifically to make squads more effective (and justify reducing size from 11 to 9). Before this the two “machine-guns” in a squad were M-16s, with heavier barrels and mostly used on full automatic. The M249 is 104cm (41 inches) long, weighs 6.8 kg (15 pounds) empty, and uses belted ammo and was far superior to heavy barrel M-16s as an automatic weapon. The M249 barrel can be changed when it overheats. The M249 was developed to give the infantry squad a lot more firepower. Army squads have two of them, marine squads had three, on paper, but often went into action with only two, with the third machine-gunner carrying extra ammo and machine-gun barrels. The M249 was a classic machine-gun, designed to put out a lot of bullets. A century ago the Germans concluded that the machine-gun was the "essence of infantry" and by the end of World War I had created the modern infantry squad as a small unit (about ten troops) equipped with a light (portable) machine-gun that was supported by the other members of the squad (who carried additional machine-gun ammo and protected the machine-gun operator).
But the Germans also developed the first automatic assault weapon. This was the 9mm MP 18, a "submachinegun" that would eventually evolve into the modern assault rifle. By the end of World War I, about 30,000 MP 18s were in use. The MP 18 demonstrated the devastating effect of automatic weapons in the hands of most members of an infantry unit. The MP 18 fired the standard 9mm pistol round and used a 32 round drum magazine that fired 6-7 bullets a second. The basic need was for a compact weapon that could quickly fire a lot of bullets. This gave the MP18 user a big edge in combat. The Germans kept developing this type of weapon and by World War II they had the MP 38 and MP 40. The short range (50-100 meters) of the 9mm pistol round prevented the Germans from attempting to rearm all their infantry with this weapon, who often had to hit targets farther away.
There was still a need for a longer range automatic weapon, and in the 1960s, Russia and the United States developed weapons using more powerful rounds (the ones used in the AK-47 or M-16) in light machine-guns. These were okay for the anticipated Cold War battles but in the last decade, American troops have largely been conducting raids in urban areas. These put a premium on compact automatic weapons, and the M249 was not compact. This has sparked another revolution, equipping infantry with a large array of weapons so they can select the ones they need for a specific operation.
You could see this coming during World War II, although informally. When there was a lot of urban, or close quarters, fighting, as during the battle for France in 1944, the subsequent invasion of Germany, and some of the battles in the Pacific, allied troops would improvise. More portable automatic weapons would be scrounged up and the official squad organization ignored. Some existing machine-guns were made portable, by leaving the tripod behind and modifying the weapon so it could be fired while advancing on foot.
Then there is the fact that combat has been changed by a lot of new technology. The increased use of snipers (and better sniper rifles) has provided precision long range fire and has been made more attractive because new technology has provided much more powerful sniper sights. Micro-UAVs like the two kilogram Raven give unprecedented views of the battlefield, and GPS guided bombs and projectiles enable the troops to get closer to a fortified enemy and less need for long range machine-guns.
All this has fed the trend towards squads arming themselves differently depending on the mission. British infantry squads in Afghanistan learned to adjust their armament to the mission. For example, when the troops would not be travelling long distances, over rough terrain, but expected to encounter armed resistance, they carried more firepower. Thus an eight man squad would go out with two men armed with L85 5.56mm assault rifles (one equipped with a 40mm grenade launcher), two with 5.56mm LSW automatic rifles (an L85 with a longer and heavier barrel), two with 5.56mm FN Minimi machine-guns, and two with FN-MAG 7.62mm machine-guns. The latter were particularly useful if the squad was fired on by an enemy several hundred meters away. These "heavy" squads also carried one 7.62mm L129A1 semi-automatic sharpshooter rifles. Thus the heavy squad would go out with only one standard L85 assault rifle and that one carrying a 40mm grenade launcher attachment under the barrel.
Under normal conditions the squad was armed with four L85s, two LSWs, and two FN Minimis. One L85 had the 40mm grenade launcher and, especially in Afghanistan (where longer shots are more common), one L85 is often replaced with a 7.62mm sharpshooter rifle. In some cases one or both of the LSWs are replaced by a 7.62mm or .338 sniper rifle. American infantry squads in Iraq implemented similar policies, having wide assortments of weapons and tools available for different missions (raids, patrols, security).
This informal upgrading of squad firepower is now becoming official policy, not the informal adaptations begun during World War II, where even captured enemy weapons (particularly automatics) were carried instead of the standard infantry rifle. Now this selective armament is becoming more standard. But one thing that has not changed is the need for at least eight or nine men in a squad, a requirement that has not changed since the Germans invented the modern infantry squad during World War I (1914-18). Nine (or eight actually) gives you enough men to carry all the specialized weapons you need to handle the unexpected situations combat usually throws at you.