Were they ever "popular?" Hasn't Opera and Classical long been the domain of the highly educated and elite? The more intellectual among the middle/lower class only receiving via recordings, radio, charity concerts, and community ensembles?
They struggle right now yes, but the major organizations in the great cities (London, New York, Los Angeles, Vienna, Berlin, etc.) all seem to still stay afloat.
Opera used to be rather popular, back before there were recordings. Opera stars like Jenny Lind and Enrico Caruso used to be a big deal, and played to packed houses. Every city had an opera house, even quite small ones.
Ballet and classical music were similar, as was classical theater like Shakespeare. They would be presented by touring companies, as well as community groups.
I think that recorded media played a key part in displacing them. The older forms, in their most expensive incarnations, remained as entertainment for the wealthy, as a way to distinguish themselves from the masses who watched recorded entertainment.
But a lot of grand old movie theaters started life as opera houses and classical theaters. They used to be popular entertainment.
They struggle right now yes, but the major organizations in the great cities (London, New York, Los Angeles, Vienna, Berlin, etc.) all seem to still stay afloat.