Not true. It really depends on your use case and blanket statements like this aren't helpful. Yes, the pass has doubled in price since few years ago but it still does make sense in many cases, especially in multi-week multi-city Japan trips
This is not a blanket statement as my first sentence is recommending people to make calculations based on their planned trip.
These are all "long" but really not that time-long distances. Shinkansen and regional trains work pretty well for these. And yes, a lot of tourists move between the cities quite often, even some metros accept the JR pass.
I was there twice in last 3 years and for our calculation it took 5-6 return shinkansen trips to justify new jr pass price (2 weeks jr pass). And let me tell you shinkansen are experience on their own so there was no lack of will to find daytrips using them
Again that's my POV, but since the price hike I've never met someone who got a good deal with the JR Pass.