I think "vanity press" is unfair in this case.  A book is a nicer thing to hold and to read from than a computer screen.  If you want to share what you've done with friends and family, then it's the same sort of principle as giving them a real photograph rather than a URL.

Vanity publishing, however, is alive and well locally.  A small press runs competitions, then sells high-priced, cheaply produced anthologies to the lucky winners.  I was caught out by them a couple of years ago when they invited my daughter's school to take part in a competition, because you can't possibly say "No, you haven't really won a competition and it doesn't really prove your work's any good" to an excited ten year old who thinks she's getting published for real.  

No, you buy a book for her, a book for yourself and a book for Grandma... :)

But a surprising number of adults fall for it. They turn up at local poetry events, announce themselves in loud voices to be competition winners and to have had a book published, then see what the real poets are doing and never come back.