years ago, when i first started recording music, there were a lot of things that couldn't be done with a computer. like, trying to use midi to trigger something that sounded like a guitar? you could make paste together guitar riffs that were obviously made using samplers, but the emulation wasn't close. other instruments, like strings, could be done fairly well with expensive synthesizers, but not with any widely available sound card.
when vst instruments came out, it was exciting but the plugins were mostly toys or driven around recording to wave in real time. over time, the power of midi-based vst plugins has come to the point where there's no longer any foreseeable limits in using midi (that is written musical notation) to convincingly emulate any possible instrument. the problem has been solved through sample libraries, mostly. when integrated with the power to synthesize, it's become a really complete answer to electronic sound production.
that doesn't mean i'm going to throw my guitar away. really, it's sort of the same thing with the guitar, although i noticed this around '08. using a combination of amp simulation and effects processing, i can basically make my old guitar sound like any type of guitar that's ever been recorded, and some that never have. with a relatively small investment, anything a guitarist could possibly imagine is available within software.
that actually makes it a really exciting time to be a musician.