people said photography was the death of painting.  people said movies were the death of photography.  people said television was the death of film.  people say a lot of things.  different art media simply change to reflect changing society/culture, and very rarely does that happen in predictable ways.

at the radcliffe publishing course in the summer of 2000, all the publishing folk were a-twitter with the end of books as we know them and were convinced, en masse, that e-books would, shortly, take over the world.  i have yet to see someone on a beach or curled up in bed with an e-book.  

literacy, i hope we can all agree, is valuable in general.  and as long as we can read, there will be long-form written stories (aka novels) telling us about how we live and who we are.   

p.s. if you scratch the cool, calculated surface of every critic who sounds the novel's death knell, you will very often find an aspiring novelist.