Maybe that was MS' problem. People that buy a 1st gen (2010) and still using it. Not upgrading it. Not replacing it. MS can't possibly profit off of it when only 1 kinect per lab is bought.
The only game in my house that could ever utilize it was the original Dancing games from the demos. The last time I saw my daughter playing it, she was holding her phone, and using it for the sensor instead of the kinect through their integrated app.
I asked why she would do that? Just plug in the kinect and use it, don't risk dropping your phone while dancing, but that's not how she wanted to play.