Poetry can be memorized a lot more easily than prose, so it carries obvious advantages when you're a storyteller in a largely illiterate society (or trying to learn a major part in a three-hour play on short notice). That's at least one selection pressure in favor of the epic poetry format that wouldn't apply in the modern world.

I don't think it's sufficient to fully explain the shift towards prose, though. Epic poetry was a big deal as late as the Romantic generation, when literacy was already fairly widespread. Perhaps it has to do with the shift away from teaching the classics, many of which are epic poems?