Smartphones killed the market for low end compact cameras, because the average consumer uses their phone instead of a shitty $200 entry level camera.

The high end stuff is doing well with content creators and professionals. You can see this in the move upmarket of things like Sony A6600 ($1400 APS-C camera) and RX100 series ($1300 compact camera) that are aimed at creators in the attention economy. I think from here on we'll see smartphone needs driving sensor development, but that doesn't mean the camera market is dead.