Ignoring the fact that memory allocations as of 1999 were somewhat more generous than that, the problem of backwards-compatibility is more induced resource wastage by current low costs than insufficiency of earlier computers.
We've been at a plateau of roughly 1-2GB RAM for most of the past decade, masked by the fact that devices have been shrinking (phones replacing desktops) rather than resource allocations growing. Which is a fairly frequently-encountered trend in technology.
We create some design, it proves useful, and for a time, focus is on increasing size, power and performance. Then a shift occurs and the focus is on smaller, more distributed systems.
James Watt's steam engines typically produced 5-10 horsepower output, and he built 500 of these by 1800. Following expiration of his patents, and the adoption of high-pressure steam engines, a period of increasingly large and more powerful systems began ... until the realisation that mobile power was a thing, and electric generation, leading to steamships and locomotives.
With electrical power distribution, whole factories were transformed from shaft-and-belt distribution from a 10-20 hp prime mover to electrical power distribution to individual motors, some of which rivaled or exceeded earlier entire steam engines, but many of which operated with fractional horsepower, delivering motive force precisely where needed.
Locomotives grew more powerful and faster, until internal combustion engines allowed 10 horsepower cars to reach speeds of as much as 30 miles an hour on city streets or country roads, without rails or being bound to fixed routes.
Console radios became portable became handheld became a smudge of silicone you probably don't realise still exists within your phone (virtually all are FM receivers).
Warehouse-sized computers shrank to refrigerators, cabinets, towers, pizzaboxes, luggables, portables, laptops, notebooks, tablets, and phones. There's little reason for even a desktop computer to be much more than the size of a paperback beach read these days, other than port size.
The IoT (the "S" stands for "Safety") is the equivalent of putting compute power where it's needed (or not, as the case may be), but it's so cheap to do, and cheaper than equivalent non-compute-based means, that it's become increasingly difficult to buy silicone-free basic appliances and components.
Many of these small systems don't have huge resource allocations, but they're sufficient to the task. They're not end-user interactive devices ... except where they are, with the Twitter-enabled refrigerator (that's a Web browser running on the display).
Web designers have been buidling on the assumption of ample resources, or have used "requires recently-acquired hardware" as a market-segmentation technique (the poor won't buy your dosh but can't afford the kit required to run your website, so feature-block them out and pre-slim your conversion funnel -- I don't condone this at all, but it apparently works).
But there's no inherent need in transmitting a few kb worth of actual text and a few ten-thousand-word pictures to do so. 20-year-old kit should handle that fine, really.