Perhaps he realized how fantastically Hillary Clinton is doing, and how many big-shot donors she's already sewn up, perhaps he felt too old, perhaps his family didn't want him to do it and/or perhaps President Obama told him he would be throwing his support behind Clinton—anyone's guess.
But I think he is doing the wise thing, as he would not win.
Clinton was quick with a classy tweet on the subject:
.@VP is a good friend and a great man. Today and always, inspired by his optimism and commitment to change the world for the better. -H