You stole what I was going to say...
What I see is the desktop market getting smaller and smaller; even the gamers are trying to cram gamer builds and water cooling into smaller and smaller cases. Gone are the days of cumbersome desktop towers purely for the sake of space, but I don't think the desktop is dead... or ever will be in one form or another.
As far as upgrading, I think component performance has hit a plateau, at least CPU performance. Where I see breakthroughs now is in storage... big TB HDDs and affordable, readily available SSDs. Eventually this, too, will pass, and by that time, the Next Big Thing in CPUs will take off, etc, etc, on and on.
Personally, I'm still working my 2500K and, in fact, in lieu of upgrading my Haswell Pentium machine... I took the
retrograde step and got a used 2500K to put in my leftover Z68 board, turning it into my gaming rig, expecting it to carry me at least 4 more years down the road, with maybe a suitable GPU upgrade in 2 years or so.
Will I ever gut my main desktop and build it back up from scratch? Probably... but not in the near future...
Edit: Actually, if I ever rebuild my main desktop (or, possibly, even my gamer) it'll be mITX. Because I like to tinker, that may happen sooner rather than later... but because I enjoy the engineering challenge, not for any limitations of the PC itself.