I don't think that celebrity is dying as much as the nature of it has changed. People like Kim Kardashian are famous for what exactly? And yet she's a celebrity.
I think with movie stars specifically, the days when you could have a hit movie just by having a certain star in it are pretty much over, but that has more to do with how people consume media these days. A fan might think say "Bobby Handsome" or whoever is the greatest ever, but not want to go to the theatre. They'll just buy all his DVDs.