There have been cries and proclamations of Second Life's demise since I can remember way back in 2006. Of course many will quickly proclaim just what it is that happens to be killing Second Life off and it ranges all the way from how interactive Linden Lab is with their customers to grid stability to the policies and rules the company introduces and (erratically) enforces.
I don't claim to be an expert and surely much of these things are contributing to the bogging-down of Second Life in terms of user concurrency and just plain old "mind share” out there in the wild open Internet in general. I see the 'problems' facing Linden Lab and surely I have my own reasons as to why Second Life is showing it's age and the patches of rust and crust.