This is mixing two concerns: Selling stand-alone applications and the specific shareware distribution model.
The SaaS world is struggling with the "freemium" model, too. Nothing pretty much changed there, you get your nag-screens, limited features etc.
Selling apps still works for a lot of people. Sure, it's harder when there's a popular free version available, but the same is true for SaaS again.
One major issue is the pernicious "growth" mindset: Today it's often not enough to earn some decent money, you have to "found" something. And sure, it's friggin' hard to grow a company out of a shareware product.