Because reading from an RSS source required you to have an RSS reader of sorts and there was some configuration required on the users' part - Install a client/setup an online tool, this was an extra (rather complicated) step as compared to say, simply going to Facebook and subscribing to a page you like with the click of a button.
Now, I'm not discounting the possibility it may have been killed strategically by the internet giants, because it's not in their interest, but I do believe Google Adsense (at that time) did allow you to publish ads into your RSS feeds somehow. So, maybe they killed it because of poor adoption rates and the configuration required to setup one?
It could have taken another direction. We increasingly saw the embedding of the page Like button as we saw the decline of "Subscribe" button for RSS. So we moved from an open protocol and an ecosystem of "readers" to a propietary "protocol" and fenced-off news feeds.
I don't think the lack of incorporating ads in an RSS feed was a reason either. I think google just passively responded to the rise of blogs/rss with tools like Reader/feedburner/adsense-in-feeds, they didn't push for the greater vision that RSS implied.
I think open protocols need time, and we didn't get the time we needed before Facebook arrived...
Up until a few years ago Safari supported RSS natively: there was a button you could click and a native RSS url would open in your browser that you could read and filter and everything.
Nowadays the alternative in Safari is "reader" mode, which removes all the website styling and leaves just the main content and also the notifications API, which allows you to subscribe to a site (if they support it) and get notified of new content without even opening your browser.
I didn't really use RSS and don't use the replacements either. I really like the idea of RSS and I think it's worth implementing for people who like it, but I never found it useful for myself.