I think the biggest problem isn't that magic is too WEAK, but that magic doesn't SCALE properly.
To me, the late game is usually defined by big armies, filled with squads (companies? the 12-soldier one) of units, usually with extremely high defense and high attack power. Most 'stacks' of units have upwards of 200 health when well-trained, while most have around 100-150. And magic can't do more than a fraction of that at any time, and can't do it reliably.
At the end-game, if you are fighting a Sovereign, especially a caster Sovereign, I would expect you to take massive losses. That sort of battle brings to mind legions of soldiers assailing the walls of a city, with fire and lightning carving the army into bite-sized pieces. Sovereigns represent the ultimate magical potential in the world, because not only are they channellers, they are channellers without the blood distilled.
Lore-wise, a Channeller is supposed to be a match for a Titan. They (the Titans) were afraid of Channellers, because they (both) were equal to each other. If Channellers weren't much of a threat, then the final battle, and thus the Cataclysm, would never have come about. At this exact moment in time, I can't trust my Channeller to reliably fight off a single human bandit. And it strikes me as ironic that he's useful only for taking down spiders.
Which, I admit, my Sovereign does quite well. Especially given that spiders have 3-6 HP early game, and I usually have 15+ intelligence, so the odds are in my favor.
At the moment - magic is very strong in the early game, and very weak in the late game. Against a lone target, hurling a spell is a viable, acceptable method. If that target is grouped, however, magic suddenly loses much of its value. AoE spells are convenient for softening up a large batch of enemies, but again, there is no way to do this reliably. In essence, a caster-type Sovereign will have a much harder time than a non-caster-type, unless heavy abuse of the Summoning book is used.
Reply to StillSingle - Early on, I abused magic to keep my cities safe. However, the more I look at my army composition, the more I realize that magic has no value late game. Softening up armies is a grand idea, but given the sheer size and number, it becomes difficult without a plethora of shards to actually have any meaningful affect. My argument is based on the premise that, in a game called War of Magic, magic should be something that is very limited (check), very risky to give (check), possibly world-changing (check), and because of its rarity, be like a giant siege weapon (no check). Magic represents, as I said above, something that the Titans wanted to control, and the Channellers represented something that struck fear into a Titan's heart. Against weak enemies, magic is powerful. Against an army, I am reminded of the old saying - never bring a knife to a gun fight.
Reply to Luketan - I think the biggest thing that hurt the dev team was the fact that Elemental is going to be multiplayer, and they had to fight to keep things balanced - hence why so many spells are simply copies. When balance comes into play, you can't do too many things that fly off the handle, else you risk having to fight with people later on when tactics/spells/mechanics are used in such a way that they just dominate the field. Personally, I'd rather have spells work in such a way that they are unique from each other.
If I were to draw from the Guild Wars system, then Fire would be hard-hitting AoE spells; Air would focus on single-target spike damage, or quick spells that rapidly build up damage; Water spells would be controlling and manipulating, freezing enemies in place and whatnot, yet doing less damage; Earth spells would take longer to cast and more mana, but always have additional affects that really hurt (IE, earthquake causes a knock-down, or a stun in this case...dust clouds would reduce chance to hit...etc.) Even from the WoW system, where fire magic hits like a burning truck filled with flammable materials, and where ice magic is more low-key, but has so many additional affects (slows, freezing, stuns, as well as restoring mana to allies) that it is too viable to avoid.
The best solution I can think of - we need to create our own spells. Not because Stardock can't, but because at the end of the day, their hands are tied with the balance issue. As much as I want to say Elemental is for us, Stardock is still a company, and they need to appeal to all of their players. I never do multiplayer, but I imagine that people would really start to complain if they were in a MP game and one tactic was the catch-all-win-all thing to do.
Does this mean that I think we players should mod in ALL of the spells? Nope. But once we players figure out how to make magic unique without being over-the-top, Stardock will be able to skip the theory, testing, and possibly implementation stages. They've done a lot of work already, so making their lives easier can't hurt : D