The key element with MIDI is that it allows you to program a sequencer that can control an enormous variety of instruments, many simultaneously in what sounds like real time. Without a sequencer, you do not have a DAW, you have an audio editor.
Without MIDI we would be pretty much into the Tower of Babel as far as electronic/digital instruments are concerned. In the early days you had a box with a few knobs and a lot of holes in it to plug patch cords into, and each instrument was a law unto itself. Unless you want to return to the days of playing everything live and recording the result, with limited ability to alter timing to match up pre-recorded parts, then something like MIDI is needed. If you had to load a separate driver for each softsynth that would translate commands from each different controller it would rapidly become unwieldy. That is the way early MS DOS printers worked, each came with its own driver, and was useless without it. The cost saving alone in the ability to use pretty much any controller with pretty much any instrument are well worth the price of settling on a basic standard.
MIDI is not static. The MIDI over USB spec has greatly improved the number of channels and speed of transmission available. MIDI polyphonic expression, which was recently introduced, goes a long way toward getting past the limitations of variable note by note expression from the use of per channel controllers. Instruments are being developed that will no doubt take full advantage of that.