There was also a certain amount of hype about 3d optical data storage at the time. In practice, this is at this point more or less a dead issue, but it was very much The Future in the 90s. Also shows up in Star Trek TNG and on.
Flash because it's cheap enough, high density, arbritarily scalable for whatever storage is needed.
Streaming because the difficulty making any optical rewritable (especially with respect to write speed) meant the niche overlapped with bluray and DVD, but why bother with yet another optical disk for films and games when bandwidth becomes more important than single-disk capacity.
Some combo of flash and spinning rust storage really makes the market for very high capacity optical storage a bit niche. It might still have a place as archival media (and multi-layer optical disks, which are 3d optical storage of a sort, though not to the level of sophistication imagined in the 90s, are used in that role to some extent), but it's just really hard to see it rivalling flash for mainstream applications at this point. In particular, flash is really, really, _really_ fast.
