I think it will happen in the near future, technology is moving forward so cryptocurrencies do. You can pay by crypto for online shopping, there are places where for example FuturoCoin are accepted, there is first FTO ATM in Wrocław and this is only the beginning

Absolutely not. The market is very huge, and it will grow every day, there is no way that in the end only few coins will left. In my opinion, in the next years the situation will change - the strongest coins will be even stronger like Bitcoin, like ETH. I also enjoy following some smaller altcoins to see their progress (or downfall), for example FuturoCoin. Recently they've published some cool quotes from their recent conference.