That's because of the battery drain that a cellular radio would necessitate -- apparently the experience would just be too compromised right now. However, it sounds like Apple was still able to add a GPS chip, itself a relatively power-hungry component. But with Apple's focus on health and fitness tracking, a GPS chip will make the next Apple Watch far better at both navigation and determining running and walking distances.
Eventually, Apple's goal is to uncouple the Watch and iPhone entirely, but for now it sounds like the experience of using the next-gen Apple Watch won't be wildly different than what's out there now. This marks a change from a rumor we heard in April, which indicated the next Watch would include a cellular chip. In all likelihood, no matter what happens, we'll see the next Watch unveiled this fall -- probably at Apple's annual September event that'll also take the wraps off the next iPhone.