EPS is (almost) dead

Due to its lack of many modern features, and the fact that it does not support colour management, EPS is no longer recommended.

EPS was Gutenberg on Steroids

(a very brief dive in history)

In 1450 Johannes Gutenberg revolutionised letterpress printing with movable type letters. Everything before was handwritten or cutted in wood.

These moveable types survived in many ways, typewriters, where the letters were banged against an inked silk ribbon and then on paper, with lead typesetting till in the late 1970ies. Parallel photo typesetting was invented, a disk with all letters on a rotating negative, exposing on photopaper. And this was fast, faster than the old school lead typesetting.

You can hardly imagine, how huge the impact of inventing DTP was. A personal computer, a dot matrix printer where up to 48 needles - again banged against an inked silk ribbon - were able to form something like an black and white 1Bit image on paper.
Not to forget the huge noise.

The invention of a page descriptive language (in this case Postscript) and the availability of a laserprinter - that turned everything upside down and made letterpress, lead type setting, foto-images setters and much more obsolete. Gone in a few years.

The last step was EPS. The encapsulated postscript opened a whole new way of handling graphics, type and images. They were reusable, resizable, and editable.

EPS was developed by Adobe, Aldus (the makers of Pagemaker) and Altsys in the late 1980s. It was used as a container for images or vector information.

It was based on Postscript, developed by John Gaffney and John Warnock (the later founder of Adobe) at Evans & Sutherland in 1976.
At the same time, Xerox (later Rank Xerox) was developing a laser printer.

Roughly speaking, this was the time when vector graphics could be printed on a pixel-based system.
In 1985 the Apple Laserwriter was the first printer shipped with an Postscript interpreter.

Earlier vector formats such as HPGL (Hewlett-Packard Graphics Language - later PCL) - where a felt-tip pen was moved across large sheets of paper - were initially just vector information, or rather instructions to the printer/plotter on what to do.

Both HPGL and Postscript are page description languages.
You can check this by opening a file in a text editor.

A simple Postscript file might look like this:

%!PS-Adobe-3.0 EPSF-3.0
%%BoundingBox: -2-2 59 52
%%BeginProlog
%define and assign the scale
%note: 1 cm= 28.34645 points, % 1 inch= 72points.
%this draws a recangle with edges size of 2 cm.
/s 28.34645 def
%%EndProlog
s s scale
1 s div setlinewidth
newpath
0 0 moveto
2 0 rlineto
-1 3 sqrtr lineto
closepath
stroke
showpage
%%EOF

This is where EPS comes from. Think of an EPS as a sea container. You can open it and put some stuff in it (a drawing, an image, fonts, separations).
You take a photo of what you have just put in and close the door. You stuck the image you had made on the outside, in a very poor resolution.
With this closed container, you could then place it in a layout programme.

Moituri te salutant

Postscript, and with it EPS, was developed continuously until 2000. 

Then Adobe stopped further development.
The problem with Postscript and EPS was that newer features such as alpha masks, transparencies etc. were not implemented. Adobe focused on their own new formats such as AI or PDF.

Due to its lack of many modern features Photoshop, Illustrator and InDesign brought along, and the fact that it does not support colour management, EPS is no longer recommended.

And also: every rule has its exceptions. For some special purposes EPS is still needed. But that is another story.

sources:
Plotter in action https://www.youtube.com/watch?...
Postscript source code now in the museum
https://computerhistory.org/pr...

Images from Byte magazine May 1987.