It was a great idea, but the technology passed it by.
Aircraft range and speed increased drastically. This is happening even now. I am still impressed by the fact that my flight from San Francisco to London was non-stop.
Pretty much the same thing happened with the zeppelins.
On the other hand, transcontinental suborbital space flight will never replace normal long-haul passenger and cargo aircraft. Costs, and the problems of scaling to large sizes will keep it small and expensive.
Of course, I may end up eating my words someday...