The longer answer:
It's been dying for decades.
In the wake of the crisis at H&H (their west side bagel plant is in danger of closing down), I put my thoughts on the death of the New York bagel here. (It generated more mail than any article I've written in years.)
Truthfully, it's nearly impossible to find a decent bagel in this city any more. At least, not like the bagels I ate when I was a kid. My favorites are probably Absolute Bagel on Broadway between 107th and 108th and Bagel Hole in Park Slope (7th Ave., between 12th and 13th Streets).
But in the old days, of course, the city had at least one great bagel spot in every neighborhood.
Frankly, I think this is in the same depressing vein as what's happening in Jewish cuisine in general. (There are only a handful of Delis worth visiting in the city, either. David Sax has long taken up that campaign.)