utility isn't declining. the network is drastically expanding. bitcoin is becoming exponentially more useful all the time. the on-chain micropayment niche might be dead, but why do think that is the only metric? maybe we need to find a better solution for micropayments than to alter bitcoin's economic design just for the sake of them?

you seem to be coming from the perspective that we can wait decades to raise fees. next year, the coinbase reward drops to 12.5% of the original reward. but you seem to think users should continue to pay nothing, doing nothing to replace the falling mining revenues, in order to bootstrap the network.

you really think that's a sustainable approach---to let users pay nothing for decades and then lower block sizes to jack up the fees when hash rate starts plummeting in response to no block rewards? i don't think users will have much interest in that. it's a tough pill to swallow but it'll be a hell of a lot easier to do it now with a fee market (especially since it requires no consensus change) than later.