I wouldn't personally say it's "dying" myself, I think anyone who truly thought this would be the way cars would be in the future was deluding themselves, as manufacturers goal is to do what the majority of consumers want for peripheral/integration/automation/audio purposes with as minimal an impact on the sticker price as possible. I was still hoping so the idea of getting anything you wanted with a standardized pc interface would at least catch on enough to be sell-able as an after-market product that even made it to the local audio shop for installs, but as stated, with smart-phones and the like I just don't see how even that could happen now. While these far easier and cheaper tack-on devices exist this will stay a niche.
I would still say that if OEM pc installs become the standard we will have won so to speak, as that would make actual installation and integration that much easier, with the probable outcome of making this more mainstream as a solution. But as stated in another thread it seems more likely they will come up with the same old half-crapola factory radio that just has bluetooth integration with your droid or iphone; as that would be a far more cost effective means to give the masses what they want.