FPS still does the trick and it has plenty of variety. I would definately not say that the FPS genre is in decline.
I'm afraid that I would. A large number of the recent and upcoming FPS titles are "co-developed" for consoles and PC which, when translated from "Bull****" to "English" reads as "developed for console, ported to PC". The games have been boring clones of the same formula used by so many others in recent years, just with different textures. Which is sad, because there's still so much room to do something different, but developers don't. They all make the same game because if people keep buying the things, it must mean that that's all people want! It's circular logic, but they make their money, so everyone's happy.
Or are they? You have to admit, almost all the recent shooters have been pretty much the same. The protagonist has a large health pool, his adversaries have even larger health pools and a bunch of super weapons that suddenly become weak when you pick them up. You then spend most of the game single-handedly annihilating hundreds, if not thousands of enemy soldiers/aliens/monsters, occasionally complete a weak excuse for a puzzle (Oh no, this door is locked, however will I get through? OH! A panel in the next room! Ha ha, how clever of them!) before taking on a final boss/boss mission involving either another "clever" puzzle or fighting even more densely packed waves of enemies than before. As a challenge, we usually like to crank up the difficulty, but instead of making the game actually harder, all it usually does is make the enemies have even more health and you have less. It's not more challenging, it's just means you have to pump even more ridiculously high amounts of ammunition into some braindead AI before they cark it.
Once upon a time, this formula was new and cutting edge. Then we hit the year 2000 and we got over it. Just that most game companies don't realise it and we're still seeing the same things over and over. The games that make a splash these days are the ones with an exceptionally good storyline that's part of the game design rather than just a lame backstory to justify the improbable premise of the game (The evil, flying, magical, monster, XingDong clan have kidnapped your best girl! Now you must use your special supersoldier skills from your time as a secret agent to get her back!), or a gameplay mechanic that differs from the textbook one. E.g. Intelligent AI that aren't overly strong, but actually use tactics and cover to be challenging or realistic damage levels so that while you can kill easily, so can the AI. The other major winner are those using a totally different gamestyle including those rare treats, hybrid games, which take the traditional model and toss it out the window. There's a swathe of very good reasons most of us still believe Deus Ex was one of the best games ever made.
My point is that a little innovation goes a long way, but rarely do developers have the balls to do it (remembering that this is SP I'm talking about, not MP, so the risk is so much less). It's one of the main reasons I'm looking forward to Portal from Valve. Or rather, the Narbacular Drop team who, regardless of who owns them, are still not the regular Valve team. Narbacular Drop, while short, was a brilliantly executed game based on a very simple, yet previously unconsidered idea. Portal is that game, but all grown-up. These are the sorts of games that move the industry forward and love them or hate them, you can't deny that Valve has done a good thing for gaming as a whole by giving these guys the chance to show what they can do.
Innovation is still only one of the causes though. As per my previous rant, consoles are still the primary factor in the decline of PC gaming. Well, not consoles themselves
per se, but developers who, in this day and age, still believe that one size fits all. No matter what your perspective (from hater to fanboy), consoles in all generations up to and including this one, have some serious limitations. Any game designed for a console will have comparatively stupid AI (because it's a lot harder and slower for a controller to aim), very few controls (which are overtly simplistic and shallow by necessity) and small levels. I understand why this is and it's not a problem - for consoles. But lazy developers simply port it to the PC and call it a game and that's just not on. Console control sets make little logical sense on a PC (if you've played CoD 2 you'll know what I mean), levels which feel huge on a console feel claustrophobic on a PC and all the little player aids that a console gamer
needs to be able to play the game without it being incredibly difficult (icons all over the place, magic radars, gigantic hitboxes, etc) are redundant on a PC. They're just ridiculed as "noob" devices. Things that no-one's used in PC games for 10 years because they made it too easy. As for the AI, they remain terminally stupid, but for the PC they generally get given a better aimbot and extra health.
My point is that while these games are fantastic on the consoles for which they were designed, believing that they'll work just as well on a (generally speaking) technically superior platform with a more precise control method and the ability to handle more depth without it becoming impossible to manage, is just plain naive. A suitable metaphor would be giving someone who's just read "War and Peace" a copy of "Grug plays Soccer" and expecting them not to notice what a step backwards it is for their reading level. What they
should be giving us is "Grug plays Soccer: The Director's Cut".