Three reasons were provided: Dungeons & Dragons was a disaster, it couldn't earn back its huge budget even if every WoW player in the world went to see it, not even most WoW players know what the story of the game really is. There was a fourth reason, too, but it isn't so much a reason as why it shouldn't be made as why it won't be -- the concept art is all we have after two years.
It's true that the movie couldn't make it on WoW players alone; it'd have to be appealing to people unfamiliar with the franchise, too. But we really doubt that's going to happen, and it doesn't matter anyway because, as we said, it probably will never get made!
[Via WoW Insider]