Even before smartphone cameras, people who cared about quality weren't using P&S cameras. P&S was always for cheap and convenient, not quality.
When everyone already has a smartphone they take everywhere, there's not a lot of market for cheap and convenient standalone cameras; no matter how cheap they are, they aren't cheaper than "I already have it", and matter how convenient they aren't more convenient than not having to carry another device.
When everyone already has a smartphone they take everywhere, there's not a lot of market for cheap and convenient standalone cameras; no matter how cheap they are, they aren't cheaper than "I already have it", and matter how convenient they aren't more convenient than not having to carry another device.