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A couple of years after Java 1.0 was launched in 1995, applets dominated the Web's dynamic content arena. People used applets to achieve what server technologies are good for today as well as to improve interactivity on the client-side. Applets used to be the only widely accepted technology that could read and write to the server, access and manipulate data in the database, take user input, perform interactive animation, play sound files on the browser, and so on.
Then, we saw server-side technologies such as Servlet/JSP, Microsoft's ASP and ASP.NET, PHP, etc, mature and get accepted as the technologies for developing server applications. They can do many things that applets can plus more. The role of applets was diminishing and applets were only used for making the client-side richer than simple HTML. Later on, applets became less appealing. Several factors attributed to the near-demise of applets.