They fell out of style when blackworms were introduced here in Australia. Live Tubifex worms were notorious for making fish sick and causing internal bacterial infections, whereas live blackworms didn't cause the same problems. So people dropped live Tubifex and went with the blackworms. However, they also dropped freeze dried Tubifex because they thought it was the same as the live Tubifex. While they are both Tubifex worms, the freeze drying process kills off any bacteria, fungus, protozoa and other organisms on and in the food (worms), making them sterile and safe to eat. The drying process also removes moisture and this helps freeze dried products stay fresh for a very long time as long as they are in an airtight container.
The other issue with freeze dried foods is they float and take time to soak up moisture. This means fish that swallow large amounts of the dry food, can take in air and have problems swimming until they pass the air out (fish farts). And the freeze dried foods can swell up a bit after they have been in the fish for a bit. This is not a big issue if you push the worms against the glass under the water.