It's dead, although it wasn't FFXIV that killed it, it's Adoulin that killed it. Adoulin replaced massive amounts of old gear that was hard to obtain with new gear that is a total breeze to obtain, and now everyone has done everything and feels like there's nothing left to do. I log on, look at my inventory... try to figure out something to do... watch the shouts for a while... then I log off. That's it. There's nothing left for accomplished players to do anymore.
I think it was sort of intentional that SE killed the game at this time, in order to drive people to FFXIV, then they will release the updates to relic/mythic/empyrean weapons to revive FFXI... but I hope they haven't killed FFXI beyond reviving at this point. They might have a hard time drawing people back.