It's easy to lose a random piece of paper. Whereas people are generally extremely aware of where their phone is at all times.
Also, some people do keep their ID on their phones, either directly on the back of the case (I've seen it more on young women, maybe because lack of pockets) or with something like a magnetic wallet
Its been a while since I've heard any issues with it. I prefer the physical card still.
My ID is in my wallet. A sheet of paper doesn't fit in my wallet. So I have to put the folded paper in a pocket, where it might fall out when I take out my gloves, or I forget if I put it in my backpack, and in which pocket, etc.
A sheet of paper is extra. My phone isn't. And I sure as heck don't bring a phone with low charge to the airport... when I know I'm probably going to be using it for hours... and I've got my charger with me anyways in case I somehow did.
I have never ever in my life lost my ID or my phone. I have lost paper boarding passes on several occasions.
The failure modes of a phone don't really matter; if the phone fails for some reason (still has never happened to me), I can always ask a gate agent to print me a boarding pass.
I just like not having to keep track of an extra thing. Travel is already often stressful; having one fewer thing to keep on me and avoid losing is nice.
I think of it as multitasking. A paper ticket means I can focus on reading etc on device, while the ticket can serve its purpose. I keep all pertinent materials in a pouch in front of me however so not hard to find.