Imagination would indeed deteriorate because in a personal context you could no longer tell someone a story, or a joke or an idea. Fiction wouldn't be ruined because we don't believe in it, it would be ruined because we'd know what's gonna happen.Because the person listening/watching/participating would already be a step ahead.
actually this is simply increasing the speed of communication to instantaneous, if anything it means the spoken word would become completely obsolete except as an art form(music, poetry, things where you need to keep rhythm intact). communications improvements have driven the incredibly rapid technological advances we've seen in the past few centuries, this would be way beyond the printing press, the telephone, or the internet...