AO is an approximation of how indirect light behaves. If you have an actual global illumination solution you don't need these tricks.

AO is derived from full GI with some extremely crude approximations. Anything that simulates full GI more accurately is implicitly a more physically accurate replacement of AO. Still, AO is not dead because it is still a rather simple and cheap cheat to add more visual definition to concave corners and highly shadowed areas. Sometimes, artists decide that their scene should have this extra touch.