There is still a place for ODI cricket, much rather a 50-over World Cup, then a the Twenty20 World Championship. But really hope we see the end of pointless OD only tours, seven match series and even tri series (especially really long ones like the CB series). If ODIs are kept to just a 2-3 games a tour then I think cricket will be better off.
But the sad fact is that Test cricket brings no money to cricket. Apart from Ashes series and now Border/Gavaskar most Test series countries loss money holding them. With this in mind we probably more likely to see more 2-Test series, 7 ODIs and 5 Twenty20. Now that is what your call dire.
Personally though I think if you reduced ODIs and Twenty20 Internationals, more people will go watch Test cricket. The problem is with Test cricket is not the format, it excess of International. Your average cricket fan just wants to see the national team play, but with so many ODIs, it is easier to watch them over a Test match. If there was a limit to ODIs and Twenty20 Internationals. I think you will find there will be more people watching Test Cricket.
Really the ICC need to make a hard decision here and cut the number of ODIs, or Test cricket might be the one that dies a slow death. There isn't enough time for all three formats, plus cash based domestic competitions.