I don't know what triggered IBM's decision to step away from server side Swift (and presumably Kitura), but I wouldn't be entirely surprised to hear that Vapor influenced that decision, as it's been more of "the talk" than Kitura, and solidly developed.
In addition, I would be careful of asserting that a server side framework (Vapor) wasn't working because the hosting business that was created alongside it wasn't panning out as being effective. Today there's a lot of additional options to host swift running on a VM or within a container with Vapor that don't require a specific hosting environment to enable it. The comment in the shutdown announcement actually implies just the opposite:
Going forward, the Vapor core team will be concentrating its efforts on the framework and all of its open source packages. This includes new, free guides for deploying to platforms like Amazon Web Services, Digital Ocean, and Heroku.
I read this as directly implying that the large commodity hosting solutions were easier to use, and that the investment in a specific hosting provider wasn't panning out as effectively as they'd originally hoped, so they're dropping the hosting avenue and focusing their efforts on the framework itself to help accelerate and speed development.