It is a tough question.
The fact is that the Kibbutz is changing. Most Kibbutzim are in some kind of privatization process. In general the means of production - agriculture, industry, tourism, etc. - stay a communal property, but everything else is divided between the members. Members get paid, and salaries tend to be differential (which means, you get paid for what you do and not for what you need).
Part of the reason for that is that it is difficult to stick to socialist ideas in an incrasingly free-market society where consumerism flurishes. This is especially true where there resources are few. The fact is that the "stong" Kibbutzim, those with successful industry or prime location of commercial real estate - stick more to the classical Kibbutz model. But where the community as a whole is poor, the equal part of each member is smaller, and the stress to change the system is higher.
The story of the Kibbutz however is not entirely an economic one. Small communities exist everywhere, and have their special dynamics. But a classical Kibbutz is a small community where inter-dependence between people is enormous. In the classic settings, the collective decides what you study, what you work at, what you eat (at the communal dinning room), what you wear... Children, from an extremely young age, lived together in a "children home" and would see their parents only for a short period every day. You can see what kind of tensions this creates.
The founders of the Kibbutz may have chosen to live this way, but their children and grandchildren didn't choose, and were often unhappy with that. Certainly, the Israeli society as a while doesn't glorify scarifies as much as it did in the part, and people expect to have more personal freedom.
So the classical Kibbutz is probably not a valid lifestyle inside a free-market, free-choice society. However the Kibbutzim do try to keep the positive ingredients from the past, such as strong community ties. It would be interesting to follow and see what evolves out of this.