I think this is basically true, but it didn't "die" in the sense that we gave up on it; it just never worked. Systems software was much worse in the 1990s than it today; you could breathe on something with a string of AAAA's and get a 0x41414141 register core dump.

Back in the 90s, it's not as if any semi competent cs student couldn't slice your typical college server like swiss cheese. People thought null terminated strings were fine back then, and patching everything immediately was rare. So multi user was already dubious.