Grad Nite was a staple for many (my dad included, at DL), but there are many more that had no Grad Nite whatsoever (myself included). I'm sure local schools and graduates will be able to find other places and activities that take its place that are just as fun.
And for me, an adult local, that means I get an evening back to head to WDW!
As someone whose high school actually cancelled his grad nite, having never planned to have it at Disneyland despite Disneyland being 60 miles south of my school, I can say that these kids will be just fine. This isn't the end of the world.
This is something that I can 100% completely understand from the park's perspective. While Grad Nites are popular, they cause an innumerable amount of headaches on the other side of the coin, as Disneytwins said. The article touched on a couple of the headaches, but the one that has to stick in their craw the most has to be kicking guests out of the Magic Kingdom for Grad Nite. Even though Grad Nite has been around for 30 years, the vast majority of families schedule WDW trips oblivious of Grad Nite's presence. How would you feel if Disney blindsided you & your family with orders to leave because these high schoolers need the park to themselves so they can run ruffshot over the park & Disney can blare Run DMC from Cinderella Castle? Does any of that sound like Disney?
While the Grad Niters themselves will be disappointed, the rest of the WDW guest base will be pleased, and it will end those headaches experienced behind the scenes. Universal's a little bit better positioned to deal with the Grad Nite headaches in that they have clubs and whatever else going on al night, every night anyway, but this announcement doesn't mean that WDW is somehow in decline, or that Universal stands to gain from Disney's loss. Disney doesn't lose with this announcement. Disney will simply gain back all that it costs to keep putting Grad Nite on, which obviously is far more than it gained from Grad Nite, or the move to DHS in '09 and subsequently this announcement would never have been made.
On the Universal side, I would expect to see Universal continually upping the price of Grad Bash, since they've got one less competitor now, until schools can't pay it anymore, and mysteriously a similar announcement comes from Universal. The kids will be just fine not having Grad Nite @ WDW, or anywhere else.
"Who among you is wise and understanding? Let him show by his good behavior his deeds in the gentleness of wisdom." -- James 3:13