Every time the subject of applets comes up, people insist they are dead. Why don't people like them? In one of Joel's latest postings, he mentions applets being dead because they are slow (despite the fact that the thrust of his post - that you shouldn't bother to optimise, but rather wait for technology to catch up - contradicts this).
I think people misunderstand applets. They were not designed to provide banner ads or simple flashy icons. We've got Flash for that (which is why I have FlashBlock installed). Applets are designed for full applications and games that are comparable to any shrink-wrapped software. And if you do compare them to "normal" software, they come out favourably.
The beauty of applets is that you don't need to install anything, but you've got a feature-rich application, or in-depth game, sat there straight away ready for use. And applets are far from dead - there are tons of them out there, and for the time being it's going to be my platform of choice.