Military units around the world are increasingly making use of short-barrled, select fire rifles like M4 Carbine. This allows the operator to engage targets anywhere between 100-300 meters without worrying about the ballistic performance of his cartridge. The latest sub-gun design that I'm aware of is the Kriss Super V. It's big and heavy for a .45 ACP caliber weapon.
The earliest submachine guns were used by the Germans in WWI, during the Spring Offensive of 1918. These weapons (The Mauser C96 and the MP18) were given to the experimental Stormtrooper units, and proved highly effective in clearing trenches and fortifications.
During WWII, every nation had their own unique design: the Thompson, Sten, Sterling, PPSH-41 and 43, MP40, Suomi, etc. Even though other designs came along between 1950-1986, like the Uzi, Skorpion and MP5, most militaries were now focused on enhancing their assault rifles, either and M16 or AK-47 derivative.
The first example of an SBR being used in military applications was the Colt Commando (aka CAR-15), fielded by SF groups under the MACV-SOG banner in Vietnam. Numerous accounts from veterans of this elite task force show a disdain for 9mm submachine guns used before the advent of the CAR-15. From these experiences, military planners soon realized that rifle caliber weapons designed for enhanced portability and maneuverability would be a logical step forward. Even with the shorter, 11.5 inch barrel, the Commando was capable of hitting targets consistently at 300 meters, more than adequate for jungle and urban warfare.
The Soviets were soon implementing this philosophy with the AK-74 "Krinkov." Like the Colt Commando, it was first used by special operators, but now a days, even certain police forces are carrying them. In the United States, short-barrled weapons have become a common sight among SWAT and other law enforcement organizations.
Perhaps the greatest threat to submachine guns came from Belgium. The FN P90 is everything a bullpup rifle wants to be. Featuring a 50 round top-feeding magazine, and housing the entire firing mechanism in the main body, it is comparable in size and weight to an MP5 while offering superior ballistic performance. If this technology could be enhance to chamber larger calibers, it would certainly question the necessity of any select-fire, pistol caliber weapon in a military role.
Within the next decade I think it's possible that we'll see production of these weapons decrease to a trickle. We're coming up with more efficient ways to utilize rifle calibers in smaller packages. This would allow militaries to further condense their arsenals, maintain satisfactory performance, and save money.
What say ye?