There are only three major short fiction SpecFic magazines left: Asimov's, Analog and F&SF. Their circulation has declined tremendously since the glory days. There are a few mid-major magazines like Realms of Fantasy. But there are tons of small press magazines and collections and anthologies and it's going to be these that are the future of short fiction in the SpecFic field.
You still have to do your work and research before you submit stories, but there are even resources for that research such as Locus, Internet Review of Science Fiction (IROSF), Rich Horton reviews (google it), tangentonline.com (review anthologies), ralan.com (markets by pay rate), and Quintamid.com (searchable market list). Also, if you find a writer you like or whose style is like yours, then you can follow their career and see where they publish.
This was a really good panel. For a beginning writer like me, it's nice to think that there are a lot of places where a story can find a home and where you can find stories you like. It's a little disappointing to think that the major magazines are losing circulation numbers. You have to worry that one or more of them could shut down one day. But even if they did, the small press would keep the short form of speculative fiction alive.
I'd bet you can see the effect of the small press by looking at the makeup of the Hugos, Nebulas, and Year's Best anthologies. I know I've noticed more stories from the small press and less from the majors (Asimov's, Analog, and F&SF).
However, I do think the short fiction market will continue to change. It's already an accepted truth that a speculative fiction writer will never make a living writing short fiction. I know I'm not in it for the money! I could see the magazines acknowledging this by lowering their pay rates.
Yet, how much of the cost of Asimov's is the stories? The March 2007 Asimov's has 4 short stories, 2 novelettes, and 1 novella. Even if all of them were the max length for the category, that's about 100K words. At 6 cents/word, that's $6000. This is 1500 sales (newsstand or subscription) at $4. Even if you toss in a few hundred more $$$ for the columns, I still don't think it's the words that are the cost. I'm guessing the cost is primarily production and distribution, because you know the editors aren't making a living wage either but doing it for love.
I can see a future where short fiction could become something that's essentially done for free and distributed on the Internet. Writers would submit to the short fiction magazines because they are selective and that's how you establish your name. Magazines would make money from subscriptions, newsstand sales, and advertising in the magazine. Perhaps you could put a story in an "e-major", then put it on Amazon to sell, then put an audio version on EscapePod, etc.
Now this would mean SFWA would have to reconsider what it means to be a "pro" (especially if you don't get paid). Think about it, would you rather see Asimov's fold or get paid nothing for your story? I know my answer, but I have a day job.
In the end, this session was very thought-provoking, very scary, and yet very encouraging. In the end if you do a good job then somewhere out there your voice can be heard.