It's hard to simulate non-trivial interactivity with paper. In real life, teams are not always co-located, and software tools facilitate collaboration in different ways.

If anything, the public(consumer)'s appetite for graphic/visual/UX design has gotten a lot stronger in the decade since research was done on paper prototyping. High-quality animations and subtle interaction techniques, explosion in form factors and devices / mobile operating system [versions], and the rise of non-technical app builders may have also encouraged the development of such tools.