I wasn't there, but the narrative online seems to be that Linux won due to its strong momentum and the leading position that it established back in the 90s, while the BSDs were held back by the AT&T lawsuit. Due to this leading position and the network effect, using and contributing to Linux is simply much more cost-effective. Privately forking a BSD and making it "better" than Linux would give you a competitive advantage, sure. But it's a prohibitively expensive thing to do.

In other words, it's a historical accident that there was no strong BSD alternative when Linux was picking up steam. Now it's too big to fail, and the GPL works in full force. GPL can't work in full force in the early stages of a project.