people who download singles (illegally or legally) and give no thought to buying actual full length albums aren't real music fans anyway, in my opinion. downloading singles is like cooking up a hot pocket in the microwave: it's fast, easy, cheap, and tastes ok, but in the end it's not exactly a healthy or fulfilling meal. i call this new trend in the industry "microwave music."
it's all pretty terrible, but it just reflects the popular trends in current music; nothing more nothing less. what sells now? pop, pop-rock, and pop-rap. music goes in cycles and pretty soon (hopefully) people will wake up and crave some real music in the form of great albums. "albums" aren't the problem, it's people's crappy taste in music, and the short-sighted nature of the major labels who don't sign quality bands anymore (and don't take music fans very seriously anymore either).
it'll change in time. saying "albums are dead" implies that musicians don't take their music seriously anymore and have lost all desire and passion to compose and release a collection of songs that work together as a cohesive artistic unit. albums will always be around, whether on major labels, or more likely, indie labels.
check the recent "de-loused in the comatorium" by the mars volta. that's a true "album."
