It is interesting that this idea seems new or worth debate:
People don't care about fidelity anymore, mp3 is the norm.
You seem to be confusing two separate issues, simply because they both relate to how people access and experience music. This is like saying nobody cares about automotive performance anymore because the Honda Accord is the best-selling car.
People don't buy Honda Accords to go racing. They buy them to commute and go shopping in. It's a different set of value concerns that lead the average person to the purchase of the practical car vs. a Ferrari.
People "care" about fidelity, but convenience will ALWAYS trump fidelity.
It always has. It's not about people not caring about fidelity "anymore." People cared about fidelity when they went from lacquer to transistor radios, from reel-to reel to cassette, from LPs to 8 track, when they skipped right over DAT to go to CD's and most recently, when they threw out the CDs for MP3 files.
It's not that the average consumer doesn't want the music to sound good, but there is a balance between "good
enough" and "really
convenient."
MP3s clearly are incredibly convenient. You can have millions of them on a standard computer, hundreds of thousands on a laptop, thousands in a tiny, hand-held player - and easily access them, share them with your friends, make playlists, etc., etc.
And clearly, a 128 kb MP3 sounds "good
enough" to go past that and get to the convenience being the selling point.
I don't like the way they sound and I can hear a difference but, most folks think it sounds good enough.
As engineers, you should be trying to make the best sounding recordings you can, without caring what the final format for delivery will be (because there is always that fringe few that will notice and appreciate the work you put into it on the BluRay Audio version...) But don't confuse the average consumers' desire for convenience with a disdain for fidelity. They are not the same thing.
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