What the iPhone has done to cameras is completely insane
washingtonpost.com
washingtonpost.com
The first is high-ISO: my Canon 40D can take a good picture at ISO 800, but my Sony NEX-5N can take a good picture at ISO 12,800, which is basically pitch black - think dark room by the light of a television. You can shoot available-light pretty much anywhere, particularly in combination with the image-stabilization tech and superfast lenses that are now available. Some of the newer sensors will get a good image up to 102,400 and can capture up to 409,600, which is just nuts. That's "dim moonlight" territory, basically night vision.
http://www.sonyalpharumors.com/amazing-sony-a7s-low-light-te...
The other is phase-detect pixels on the sensors. Previously many cameras had to use contrast-detect autodetect, where the camera racks the lens and samples the image for peak contrast on the target. Only SLRs had phase-detect autofocus, which was much faster and more accurate but required a separate set of sensors. But now they put phase-detect pixels right on the sensor, so you can get small cameras with fast/accurate focus.
Not the camera itself, but lenses have also come a long way in the last 10 years. Superfast f/1.4 primes and f/1.8 to f/2.8 zooms are now faster, sharper, and cheaper (and the idea of a f/1.8 zoom was unthinkable 5 years ago). On the high end Sigma's Art series are simply fantastic, and Samyang is raising the bar on low-end lenses too.
While certainly true, I hate those moments when all I have with me is a phone's camera, knowing my far-superior-photos-taking SLR one is at home, then taking the picture anyway and coming home staring at the noise and often subpar framing (never got used to holding the thing steady in front of me). That always hurts a bit. Especially in low light etc. Not that I never took brilliant pictures with a phone or similar, but knowing that the same scene could have been even captured better with other gear I have still hurts.
And the thing to remember here is that the smartphone is displacing another "good-enough" product, the digital point-and-shoot, not high-end DSLRs. It's just a matter of convenience to have it in your smartphone instead of two separate devices.
Smartphones do not replace a high-end camera system - but those were never something that everyone owned/carried in the first place. The vast majority of cameras out there have always been the cheap variety that mom uses to snap pictures of her kids.