The first 1GB consumer drives came out in like 1993. I remember having a several GB (I think a little over 4GB?) hard drive on a home computer sold with Windows 95. DVD wouldn't come out for about another two years in the US and wouldn't have been widely used until at least 1998+. My 1998 desktop had something like 11GB of space. DVD burners and players wouldn't really be very affordable until about the 2000s. VHS was definitely still widely used for several years after multi-GB hard drives were common in the consumer market.
Even then, in the late 90s flash media was horrifically expensive. I seem to recall my family buying a 16MB Smartmedia card in the late 90s (massive for the time) for ~$150 or so on sale. You'd be storing a few minutes of highly compressed video on a card like that compared to the several hours of video you could put on a VHS tape. Direct-to-DVD camcorders wouldn't be a thing until the 2000s at which point 40+GB hard drives were starting to become common and flash cards were starting to get to several dozen MBs at least for ~$100 or so.
Just going by pop culture, we had the 4GB base model iMac in 1998 and a hit film about a cursed video tape in 2002.
Anecdotally, I remember my family getting a Windows 95 computer with a 1GB hard drive (Quantum Bigfoot, no less) in 1995 or 1996, and a really cool decorated box set of the Alien quadrillogy on VHS around the turn of the millennium from Tower Records.
VHS was already totally obsolete when 1+GB HDD came to consumer market...