For applications its hard to see why this model wouldn't be more preferential. Most .NET applications are monolithic in nature (though you can enforce really good module separation with relatively minimal effort IME). You can look at Rust too, for its developing some Blazor-like frameworks. I could imagine for example, the next GMail being written like this, or other deeply interactive applications.
I think people want to work in a singular language / framework more than anything else. One of the reasons I think JavaScript still prevails today, is it was the first language community to largely achieve this in an accessible manner. Others are now coming forward.
I think pre-rendering is still the best approach to truly static content though, using web components to progressively enhance features of a page for light interactivity, this is one area they really shine.
I could be very wrong though!