Some Background
As with any service, it might be exciting at first, and less so as you become more acquainted to it. SmugMug I believe is based on a great design, that really stands the test of time, and puts what is important front and center - great images. To me, it really parallels Google in many ways. I have grown to love the Google homepage, not for what it is full of, but what is lacks. SmugMug themes and galleries are beautifully simple, and that has always been the case.
While considering the above, I think that SmugMug has done an excellent job expanding the service offerings while still keeping its roots in mind. Some of the major improvements since I became a member over six years ago include the Easy Customizer, Sharegroups, Video support, many new upload options, Traffic statistics, Social sharing via Twitter and Facebook, additional security, built in slideshows, additional themes, and huge SEO improvements. I'm sure I've missed quite a few, because I just built that list based off of memory.
Current State
Some of the other features that are on the UserVoice site as completed with significant votes include:
Five out of the top 10 voted enhancements are either in progress or planned at this point. Setting up multi-currency international support is no trivial task for example, it is amazing that they even give us the feedback to note that it is planned.
The Big Boom
To me, the single most significant development is the "New Gallery Style" announced as a sneak peak in July 2011.

This is a very exciting development with huge goals:
- Renewed emphasis on the images and less distractions
- Easier to customize
- Improved buy button
- Smarter design and more streamlined
- Faster interface, mobile and desktop
These are not trivial improvements, and obviously they take time and a great dev team and product manager to come to fruition. These features are obviously not just for the pro account holders, with the exclusion of the goal around the buy button, they all would benefit users of SmugMug across the board.
Give Up?
Did management give up? I would say absolutely not. I have never seen such an engaged staff from any company I have ever dealt with. They know more then anyone else how much we desire and want new features. They are more transparent then almost any other company. If they push so hard that they are at the bleeding edge, I think it would lose its value quickly, as bugs develop and pro users are lost in the changes. Right now I believe they have a steady mix of new features, great time withstanding design, and continuous improvement.
I am not employed by SmugMug. I am a subscribing Power user.