It wouldn't have died - most apps are still just a thin UI over a corresponding online service, and most of the data and services proprietary APIs provide ended up achievable in a browser too. It is really just the internet that makes apps and smartphones useful.

All apps really offered was a way to gatekeep payments in games that groom impulsive spending habits, they just happened to start making very serious money on Facebook right about the moment Jobs changed his mind.

Early on it was different with a lot more stuff actually running locally vs cloud service era. App store predated that for a little bit actually. There weren't microtransactions initially either. What you'd call a AAA game for that platform back then would actually be $9.99 one time payment.