The current crop of phone cameras are certainly still inferior to dedicated cameras, but they're good enough for most people most of the time and thats what matters.
Most people won't carry a camera with them at all times, but they do carry a phone and its good enough for occasional shots. A lot of those images are going to end up posted online at significantly lower resolution than even a phone camera can manage anyway, and they will be viewed on tiny screens.
Aside from the convenience of being always in your pocket, phones have the added convenience of connectivity so you can upload your pictures immediately.
Proper cameras will always be a niche for those who enjoy photography or do it for a living, but for the vast majority of people a phone camera is all they will ever need.