I'm not saying PC gaming is dead but it isn't near the king. People will brag and boast all day long how it's supiorer for a variety of reasons, but at the end of the day, the consoles are where it's at.
PC gets ports of real games but they're almost always afterthoughts, the real attention is payed to the 360 and PS3. Unless you're releasing the next WoW expansion or you're Valve, there's simply a better chance to make money on the consoles.
You have a bigger audience (you can't count everyone that played WoW as your audience for...whatever the last big multi plat PC game was) and you have something that is infinitely more accessible on consoles. WoW may have 12 million subscribers, Valve may have a huge audience, and Solitaire and Myst might be two of the biggest games ever but the simple fact is not many people buy PC games compared to console games. That isn't saying there aren't big sellers like Starcraft II, but there's a reason PC games sell a fraction of what their console counterparts sell.
And then there's the problem of just running the game. Ten years ago computers weren't that complicated when deciding if you could run a game or not, or at least they weren't complicated if you grew up around computers. Now, they're just downright confusing to even people that are around computers all the time. PC's may be able to showcase the best graphics but that comes at the cost of having about 5 billion different options. Not only is it a pain to know just how well your computer will the game, it's also a pain to develop the game and test every hardware possibility. In short, you just can't. Developers have to hit the big ones and hope for the best for the rest.
And then there are console games. If you have a Playstation 3, you can play any PS3 game. You don't have to worry about any compatibility, fiddle with any settings, or worry about bad performance, it just goes. You pop the disc in and everything is automatic. I can't tell you how many times I've had to deal with the head aches of an outdated driver, missing dll, bad install, some screwy process running in the background, or the myriad of other problems that arise every time a PC game is installed. I seriously can't remember my last flawless PC game install.
If I wanted to play a PC games from 2007, I would have to jump through an insane number of hoops. If I wanted to play a PC games from 2000, it would be a crap shoot if it works. If I want to play a game from 1997, I probably just can't. If I want to play a PS3 game from 2007, I can. If I want to play a PS2 games from 2000, I can (since I have a backwards compatible PS3). If I want to play a PS game from 1997, I just pop it in my PS3 and it works.
Consoles may not be able to do everything PC's can do, but what consoles lack they make up for in everything else. If PC game isn't dyeing, it had been bedridden for years.
-edit-
Oh, and I forgot about the myth that building a gaming PC is cheaper than consoles. You aren't going to build a gaming PC and buy all the software for less than $400. If you do somehow manage that, you surely won't be going long without upgrading. When you factor in the computer, mouse, keyboard, operating system, and whatever other software you want, a gaming PC is expensive. A decent mouse, keyboard, and operating system alone will run you at least $250-300. I would love to see what kind of computer someone could build for the remaining $150 to keep in check with console prices.