PhysX will not last. ATI not supporting is was the final nail. No developer will create a game that uses PhysX for core game functionality if it counts out half the potential customers. Crysis flopped because nobody could really run it, using PhysX for anything "core" is just asking for poor sales imho.
It is not possible to include PhysX in the "core engine" and have a non-PhysX version as well because that will count out online play between the two camps, further reducing your customer base. The cost of games dev is so high these days its just too much risk.
This leaves PhysX just being used for eye candy effects which do not effect the core game. A costly expense for many game dev teams.
As the article someone else posted says, Havok is the more popular system and well liked by developers and far better supported. Also OpenCL and DX11 mean the end for PhysX.
3D cards could gain traction when they first came in because they were just eye candy and did not effect the game play at all. Software and Hardware render was common for many years. I believe Q3 was the first hardware only render game, if not it would have been one of the first. This meant there were a good 3 generations of 3d hardware before the move to hardware only render.
Also the Laptop now outsells the desktop machines. No room for a PhysX card and most laptop GPUs have to work flat out for the GFX.
imho - physics on the CPU is the only way now multi-core is common. We are about to move into Quad core world with the current generation of hardware.
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