Controlling spam inside a closed network is drastically easier than controlling spam in an open network, because in a closed network you have lots of ways to make bans stick, whereas in an open network you really can't. Faced with the choice of building a massive Gmail style heuristic spam filter in which basically all the messages it was processing would be spam, or, just turning off federation, they went for the latter. It was probably the right call. Very few people even noticed, let alone cared. The idea of an SMTP-style global network of federated chat servers was dead by that point.
