What happened to the idea of small, non-intrusive banner ads

You answered your own question:

they bring much less revenue compared to in-your-face video interstitials per impression

And shortsighted profit driven thinking - can make a load more money now even if some users are pissed off, don’t worry about long term user retention. Oh what!?! The usersbase is pissed and leaving/blocking things, better double down to keep them profits high in the mean time…