After playing Microsoft's Combat Flight Simulator: WWII Europe in late 1998, I confidently predicted that online multiplayer would take off. I was both 100% right, and yet utterly wrong, in that I predicted a long and bright future for online "sim" games. Turns out everybody just wants a rehash of the same old shit every year instead. Oh well...
I didn't see the demise of the more "hardcore" sim either. In the 90's, at least around these parts, it was often the release of the latest space or flight combat game that prompted hardware upgrades, and it seemed like a new one was released every other week, from the fairly simplistic Knights Of The Sky and Birds of Prey to the insanely complex Falcon and Flanker games. There were helicopter sims (Jane's AH-64 Apache), submarine sims for every occasion (Silent Service, Silent Hunter or the likes of SSN or Jane's 668), space "sims" ranging from the awesome X-Wing to the brutal and complex Freespace, and sims of practically any other piece of military hardware you can think of.
On top of that, Microsoft would drop a new version of Flight Simulator every couple of years, usually with enough differences from previous versions to warrant the upgrade. Apparently by 2002, Flight Simulator was Microsoft's second most sold software product behind Windows.
Now? Ubi pops out a new Silent Hunter every 3 or 4 years, but in truth Silent Hunter III fitted up with the Grey Wolves mod is still the best, Microsoft have abandoned Flight Simulator and the best air combat games are all either at least a decade old, or at least running on 10 year old engines.
Now if you'll excuse me, I'm off to hunt Allied shipping in the North Atlantic...