It's simple. Java was free, Smalltalk was $50,000/seat.
CTOs would pay Gartner millions of dollars to have them confirm their bias to go 100% Java/Windows/IBM.
Not that ParcPlace did themselves any favors.
Now, nearly all programming languages are free :-)
Pharo Smalltalk (based on Squeak) is very nice, and runs on Mac, Windows, or Linux box using very little resources.
Smalltalk is still used, as is Common Lisp, Scheme, etc. Just because languages are only used for < 1% of commercial projects does not mean that people skilled in their use shouldn't use them. My go-to languages right now are Clojure, Java, and JavaScript, but, I still like to code occasionally in Pharo Smalltalk (good online tutorials, BTW, if you want to play with Pharo).