Maybe the market is temporarily shaken because hardcore developers start making casual games. But there is still a big enough market for hardcore, so it only takes a while before that gap is filled up again.
I also think the casual focus might put some more fun back into games again. Realism isn't all there's to it. Example: A friend of mine only knows Lord of the Rings games. Hack & Slash etc. Then I let him play Metroid Prime 3. He fought Ridley while falling down. He defeated enemies in a very unusual way for him. He said "Wow, this game is really designed as a game!" And I was like
"d'uuh... isn't it supposed to?"