Due to the large number of accidents along the river, the government has closed the riverside bars. 

This temporarily led to a dramatic fall off in the number of backpacker visitors.  You can check out the Australian documentary on SBS television of October 16 2012

http://www.sbs.com.au/dateline/story/... 

The visitors have now returned after the temporary downturn as  there is so much more to do in Vang Vieng than get mindlessly drunk, so  the backpackers will soon be replaced by older or more family oriented visitors who make the trip to Vang Vieng to see what the fuss is about and why it was, for a while, the party capital of the universe.  The backpackers are still there, but there is a curfew in the town at 11.30, and for late night action you need to go to places out of town like the Jungle Party or the Moon Pub which stay open until about 2am.

So, if you are thinking about going and are not sure, go.  It was cheap before, but now there are some incredible bargains, and you can go on climbing courses, kayaking and caving, cycling, tubing,  walking, motorbikes from around $4 a day, lots of activities.  There are great deals to get to Vang Vieng, for example incredibly cheap flights from Australia to Vientiane with Air Asia, and then it is but a few hours by bus.. or you can get the train from Bangkok.

The locals welcome the new kind of tourism which will come about from all the publicity Vang Vieng had this year, as the new tourists are likely to  be a bit more respectful of local customs, whereas many backpackers are not.