Reseller hosting customers are often the web developers hosting their customers. It's not just small time hosts that rely on these pachages. The VPS may take a part of this market (especially the fully managed ones) but many reseller hosting customers still won't want the complication. I don't see reseller hosting as obsolete anytime soon. It may however redefine itself a bit (offering end user support may become the norm rather than the exception) and could lose some of its market.

Even if we consider the VPS as its future replacement, the market doesn't just vanish. The reseller hosting provider of today will slowly become the VPS provider of tomorrow.