A few areas that I feel we've lost functionality:
* MP3 players: I used to have a device with buttons that fit into my pocket that was able to locally hold my entire music library. I could control the device through my pocket without needing to look at it or hold it in my hand, it presented a filesystem with folders that I could simply drop music into (or whatever files I wanted, at the time 20/60gb in your pocket was a big deal). Since everythings' transitioned, first into library-based management and then into touch interfaces, actually using an MP3 player (or more specifically, whatever music program is on your phone) sucks so much more now
* Software used to work regardless of what happened to its creator. Desktop software still largely does. Nowadays it's almost like entrepreneurs enjoy writing emotional sunset posts, completely oblivious to all the customers they've fucked over because they suck at business
* Computer internals and abstractions were more exposed. Computing is slowly moving away from keeping users close to abstractions -- using modern software it feels like Product Managers want to erase and destroy users' concepts of things like files and folders. Cloud services would much rather you think of their software as an interface to their silos, and the kind of interoperability that you used to get for free by sticking to a 'protocol' of files and folders, is no longer there. (How hard is it to examine iOS or Android at the individual file level? How hard did it used to be?)
* I used to be able to open most software on my phone without being nagged with a popup for some reason or another. If it isn't a "HEY LOOK AT THIS NEW FEATURE YOU STUPID USER WHO NEVER EXPLORES ANYTHING" it's a "PLEASE VOTE ME FIVE STARS". Software talks too much, and I don't want to have a relationship with its creator. Leave me alone!
* I used to be able to boot up my computer (or, hell, even my Playstation!) without being bombarded with update requests. Software used to be finished, and as a program matured you could expect patches and update frequency to fall off dramatically. Our brave new world of evergreen programming means I am perpetually hassled with updates that I don't want, don't care about, and are frankly unnecessary. Sometimes those updates even remove features, sometimes even features that I am using! (How the fuck is that acceptable nowadays anyway? In what industry is it acceptable to take something away from users that they have paid for? We have compromised our standards too far!)