It's not dead, but discoverability is a huge problem. I still make decent money ($5-6k per month) on an app I first released in 2010, but the two additional ones since then are probably not even collectively over $1000 for their lifetime. Unless you're featured, have significant word of mouth, or are on Top Free/Top Paid/Top Grossing, the number of people that actually find your app is small. It takes significant publicity to get enough momentum in sales to where word of mouth even works.
Edit:
This isn't to say I won't make anything else. I have other apps in progress, but I'm going to apply the lessons I've learned to make them work. They are somewhat niche apps, but I've found those work for markets that are accustomed to paying for tools/software. None will be under the $14.99 price point. It's unlikely I'll ever make another one that is -- it's just not worth the effort.
Edit:
This isn't to say I won't make anything else. I have other apps in progress, but I'm going to apply the lessons I've learned to make them work. They are somewhat niche apps, but I've found those work for markets that are accustomed to paying for tools/software. None will be under the $14.99 price point. It's unlikely I'll ever make another one that is -- it's just not worth the effort.