in short – because corporations cannot TRUST their employees (enough).
If an email is truly confidential, then only the recipient is able to decrypt the message and read the contents. If the message could be decrypted by anyone else than the recipient, then the message is not truly confidential. Corporations have legitimate security reasons to want to “inspect” the contents of messages, both of those being sent ( authorization ) and those being received (protection). Considering just the sending of messages, corporations will naturally want a mechanism to inspect message contents either before effectively leaving the company premises or in less security conscious environments, being able to analyze the sent contents after sending. Without this possibility, the corporation would have to trust it’s employees absolutely to not abuse the communication possibilities. For example an employee sending company secrets to a legitimate business partner, let alone an email of wikileaks.
In the consumer world, where individuals are working on their own behalves, it is possible that End2End encrypted email systems will become more popular as usability improves and awareness of the insecurity of traditional email increases. I don’t believe Email will suffer extinction because there is no standard alternative for business to consumer communication. This process is very slow, secure email has been around for a long time like ZSentry even if the Lavabit / Darkmail is successfully riding a hype wave thanks to Snowden.
In the corporate world, where employees are working on behalf of some corporation, internal email messaging need not be truly confidential – since the communication takes place within the corporation’s trust boundaries. For messaging from inside to outside corporate boundaries, corporations are unlikely to trust their employees enough to embrace truly confidential email. There may be hybrid “gateway” like products which try to satisfy corporations security requirements – but this will not be truly end2end encryption, the one end of the encryption will still be under the control of the corporation and not in the hands of the employee.