"why should I watch TV on the fiddly computer when I can just pop a disc in?" or "why should I turn on Netflix when there's clearly stuff on cable TV?" -- that was Netflix's competition in those days. Because there was competition, they had to lower prices and improve service to win consumers.
Now, that competition is being destroyed. Rest assured, Netflix will use this market power to extract more from the consumer.
I started using Netflix in 2001 as a DVD subscriber. It was wonderful for nearly 20 years. I ended up canceling before the service officially ended because it was clear that the writing was on the wall and the service was going downhill fast. You used to be able to get nearly any movie or TV series, domestic or foreign. It's a lot more work to find good stuff now, even with streaming in the mix.
I don't even know where I would get a good blu ray drive. The videophile subreddits keep suggesting very specific models with flashed firmware, which is not exactly accomodating to the public.
What happened to Netflix DVD by mail was that Redbox ate its lunch, which ultimately was also a failing business model.
Ultimately there was just so much content available with a click for people (who collectively are mostly not that fussy) for "free" (subscription) or at most by a payment from their TV rooms.
An increasing number of shows are never getting released on physical media to prevent this. The only thing streaming services are competing with in any meaningful way is piracy and I'm guessing piracy is going to get more and more popular the more greed/enshittification keeps making streaming platforms worse
The *arrs (once configured) offer a better service in every single way that I've got multiple friends who have all cancelled their Netflix subs for a combination of piracy and physical media.