I think there are many factors that contributed to Dubstep's unfortunate demise. The number one thing in my opinion was the divide in the style of music. Dubstep had split into two parts. On one side you had the really heavy "Tear Out" or "Brostep" sound that was hard and crunchy, and played for youngsters at mega festivals. While on the other side you had the Deep, Dungeon sounding stuff for the older heads, who are probably more into underground hip hop and smoking blunts, rather than fist pumping to Top 40.
These two sounds danced along the same line for a few years, and both crowds seemed to reside peacefully together, but eventually they started drifting further and further apart. The sad thing is, they both needed each other to survive. The heavy Brostep got so hard and abrasive, that most of the musical content was lost. On the other end, the softer dubby stuff got way too ethereal and ambient, and started putting people to sleep. If Dubstep had stayed united in a similar realm, then both sounds would have stayed alive, but it kept trying to distance itself from the other side. The youngsters could have had their heavy sounds without their ears bleeding, and the older heads could have had their more intricate sounds with enough of a hard edge to keep them dancing. These two genres splitting apart, along with the crowds splitting apart, spelled doom for the genre.
Dubstep was not big enough to sustain itself after a breakup like that. I know many of us in the "scene" tend to think Dubstep was the biggest thing in the world, but I assure you it was just a small blip on the musical radar. Most people had never heard of the genre. I estimate that in it's prime, only one out of 20 people ever heard of Dubstep, while only one out 40 actively listened to it.
House music was able to split into sub-genres because it had become big enough to sustain itself, and it had began to evolve immensely. Plus, it came out at a time when people didn't have such short attention spans, and access to everything at their fingertips. House music was a revolution in music, at a time when a revolution was needed.
There is a difference between popular, and commercial. When Dubstep exploded, it became too commercial, and by commercial, I mean literally used in commercials. Dubstep music was in every commercial alongside a video in slow motion to promote vodka, shoes and Go Pro cameras. Once that happened, it was all over. The genre became a product, and no longer a movement.
Also, the over saturation of really really bad music being released on Beatport (etc.),without any sort of filter, made DJs extremely tired of hunting for tunes. Not to mention all these record labels re-releasing the same music over and over each week in bulk. It became too much to handle. Then came all the remixes. Everyone was making a Dubstep remix of every popular Top 40 song in an attempt to go viral. When your main goal is popularity and not quality, the music suffers.
Agents also started asking for insane amounts of money to book their artists, but not every market could afford it, so promoters started booking these up and coming Trap artists that were thirsty as fuck for gigs. The greed that some of these Dubstep artists showed, ended up being the nail in their own coffin.
The genre itself also didn't evolve enough in due time. Sure it evolved quite a bit over it's 12(ish) year span, but not enough. When people started getting tired of the same sounds and tempo, it just continued to run itself into the ground. But why wouldn't it? On the surface it looked like it was healthy. It was more popular than ever, and why change a good thing? Here's why: You can never know when you've hit the peak, and everyone thinks their good thing is going to continue to grow. It's like a gambler that can't quit while he's ahead. By the time Dubstep started crashing, it was already too late to fix things. Music needs to evolve constantly, especially when things are going good. It's too easy to get lazy and comfortable.
Fans also age, and stop going out once they start careers and a families. It is essential that a genre constantly appeals to the new generations of party goers. If it doesn't, everyone who once liked the music will grow up and stop going out as much, hence killing the scene. Also, girls make or break your party. Once Dubstep shows started having mosh pits, the girls left. No girls, no party.
It also struck a huge blow when 2 of the pioneers of the genre, Skream and Benga, denounced the whole genre and said they'd no longer be a part of it. How are people supposed to respond to that? We all thought that Skrillex winning Grammys was going to be the greatest thing ever, but it ended up being the worst thing for us. To his defense, he really did try to get people to understand the full scope of the genre, not merely the style he had become known for, but people still associated all Dubstep as being "Skrillex Music".
With music, you either need to stay underground, or go full commercial. It all depends on the music itself, and the culture behind it, and it's really hard to tell what will succeed or fail. You can't really reside in the middle for very long. With House music, it had mass appeal and was able to explode and stay relevant, while many of these other genres of music can't seem to do so. It's not as if you can proactively stop music from really becoming commercial though, especially when people want to get paid for their hard work. It's going to happen one way or another. I guess all you can do is cross your fingers and hope that it won't get bastardised like Disco.
When I first heard Dubstep music, I loved it, but I never thought it sounded like dance music. I loved Broken Beat (House) and 2Step/Garage, which never got too big in SF, but then I got into Dubstep. I thought it was great, but never could imagine that it would get popular in the clubs. It always sounded like music I would listen to at home, or in the car. Once it did blow up in the clubs I was so happy and had a restored faith in humanity. I hate to say it, but maybe Dubstep never would have sustained itself for this long if it wasn't for "Brostep". Maybe it would have died in 2009. As I said before, traditional Dubstep did need that extra edge to propel it forward, I just think it went a bit too far.
There are many other things that contributed to the bubble bursting and I wish Dubstep never came crashing down, but maybe we can learn from this and use it as a learning tool, but most people won't. Music isn't created to be revolutionary and change lives anymore. It's just background noise for our drug and alcohol binges. We live in a corporate society and live our lives in excess. It's no wonder everything gets chewed up, then spit out. It's been happening for centuries, so there's no reason for things to change now, but a little self awareness never hurt anybody.
Here is a graph that has been causing a buzz lately. Just thought I'd share it, no matter how much it pains me: