I don't think it's really hit it yet...I don't think there has been a decline enough to look back and say that the games that are out now are worse than before...as technology has progressed, so has the industry.
I mean, I had amazing times playing my Atari 2600, NES, SNES, then onto my PC with Zork (et al), BBS Door games, Bards Tale, Kings Quest (or anything by Sierra), Single player adventure / RPG's of all kinds, and then into MMO's, etc...and that is just one niche.
Not even mentioning logic, puzzle, war, racing, turn based strat, and on and on...there is just so much that has come to be and is continuing to evolve that I don't know if we'll see a down turn in gaming any time soon, imo....is some of it crap, sure, but that is true back then, too.
It's those amazing titles that take whatever genre they're in to the next level that really keeps it going and keeps players involved.
Not to use an obvious choice, but look at Skyrim...I mean, that game just set the bar ahead for almost everything out there, and it will take some time before the 'standard' games even begin to compare at that level (if they ever do).
I think with tech, innovation and geeky gamers who become programmers, we should see the industry continue to thrive for quite some time. (I hope!)--
I am only one, but I am one. I cannot do everything, but I can do something. And I will not let what I cannot do interfere with what I can do.- Edward Everett Hale
My Blog - Raising Connor