What killed them: Not-so-good compatibility with all the new ajax sites.
This shows a worrying disregard for the people who are building innovative stuff (startups). All startups push the limits of your browser. And they build and test on Mozilla because it's just more open (plugins), more debuggable (firebug, coincidentally a plugin), and more widespread (so the return for your time and effort is higher).
Even in they get the best grades for compatibility with standards, the real test is the sites out there that fail to work 100% with Opera. My guess is that this is quite a lot, but the Opera user rarely notices unless there's a major borking that makes the site unusable; then they go to another browser, and discover what they missed. Not so fast anymore
. At a certain point, not long ago, plugins would give you little advantages; nowadays, there's an entire universe of new things that take the form of FF addons. Some of the most innovative software in 2008 was an addon.
I think they are listening to the users but to the wrong ones
Agreed. And they have lost their sense of what's useful on the web today.
Opera smells like some creative guys (who put out incredibly innovative features) crushed under the weight of horrible management.
I switched from Opera to FF ~ 3 months ago, after being an Opera user since v. 5.