My apologies, I misunderstood. The rant below is entirely my 2 cents on the matter and should not be considered a factual analysis.
I think it all has to do with convenience. That is the
#1 reason why audio- and video-streaming services are just so popular. DVD-Audio did not offer any new sort of convenience and required quite the investment, when people were already knee-deep in Audio-CD's and their required hardware.
Video-DVD took off because it was yep, more convenient. No more rewinding your goddamn tapes, a lot more bonus content and clearer picture. Major win.
Audio-CD's took off because it was yep, more convenient. No more rewinding your goddamn tapes, no more flipping your tape to side B for the next batch of songs and an audible increase in quality. Major win.
Audio-DVD's had a slight increase in audio quality and was not more convenient than an Audio-CD. It also required expensive hardware (back in those days) and this during a time when people were getting stingy because that diabolical fiend of a Napster came crashing in through the doors.
Hold up... Free music with an inaudible difference in quality?!
Every kids dad was looking into how to download music. And the graph speaks for itself.
And talk about convenience. Double-clicking a file to listen to 1 specific song as opposed to getting the CD, taking it out of the jewel case, praying to God that the disc doesn't have scratches or isn't dirty, skipping through all the tracks to get to the song you wanted. Goodbye back-breaking labour! And a standard family only had one pc standing in the living room anyway so it was there for all to enjoy.
It was also around 2000 that video-DVD's were becoming a mainstream thing. I recall saving up for a PS2 around that time and being one of the first people in class being able to play a DVD. But by the end of the academic year, everyone had a DVD player. Sure, you could download movies on your PC back then, but it was a whole hassle getting it to play on your TV. For the people who watched movies on their PC monitor, it worked just fine. But when you got a family that wants to collectively enjoy movies, DVD's was still the best movie-watching option. I'm starting to feel like Randy Marsh after buying that Blockbuster video store.
Audio-DVD's were a very niche market and offered no new form of convenience. Kind of like why 4K Blu-Rays aren't taking off (and probably never will), despite the fact that the picture quality is better (in theory) as opposed to streaming (4K) video content. The average person just digs the whole comfort of Netflix, Amazon Prime etc, even though they are compromising on quality when compared to the best physical media out there.
Man I used the word "convenience" a lot.