Putting aside the competition factor down in Florida, WDW should be improving and upgrading their theme parks and resorts regardless of the improvements being made at Universal and elsewhere. There is simply no excuse for WDW being in the state it currently is, they got comfortable and complacent and thought guests would keep coming back and be satisfied. People don't go to WDW to be satisfied, they want to be blown away by the innovation and immersiveness that once was synonymous with the resort. The FLE is a step in the right direction but it's merely one step and there's quite a way to go before WDW returns to the heights it once scaled; three out of their four parks need work IMO (I don't think Avatar is enough for AK right now) as well as Downtown Disney. Change won't happen overnight and it won't be cheap but it is needed, not because WDW's rivals are improving their own product right now, but because the WDW of today pales in comparison to the one that made us all fans of the resort in the first place.
I think people go to WDW for a vast array of reasons, no different than 20 years ago, except some of those reasons have changed.
I do believe there is an addiction factor for some (no, I know it, but am trying to be 'nice').
I do believe there is a lifestyle component (that didn't exist 20 years ago) of people moving to O-Town to avoid life and spend vast amounts of time killing life while oogling the construction walls in Fantasyland or walking around the World Showcase lagoon.
I do believe there is a nostalgia factor that is being played that didn't exist at one time, a nostalgia for past vacations at WDW and not nostalgia for Colonial America or the Wild West or the exotic Polynesia.
I do believe there are more people visiting WDW because while they have the funds to go elsewhere, they are afraid (I'm not even talking China or Germany here, I'm talking NYC or LA or SF!)
I do believe (actually I KNOW it to be true) that WDW and its marketing department have used all of the above to cultivate a stale product, one that doesn't get the tender love it requires, but gets the quick 'luv ya, peck on the cheek as you rush to the car!'
I don't believe WDW will ever be the place it once was. Can it be better than it was in 1999 or 2003 or 2007 or 2010 or now? Yes. But there's no going waaay back. Not possible. WDW is always going to be a lesser product than in its golden days because there is no going back.
Times have changed. People have changed. They are dumber than ever. They are more willing to play corporate apologists than ever. But I don't wish to start discussing society's ills ...
so I'll just end where I started the thread: WDW will get better in the years ahead, but it is due to others and not a fundamental desire to be the best, but it will come at a cost and you can expect more price increases and cutbacks as TDO desperately tries to not lose more market share and have numbers that don't look as bad as they really are.