Because IMAP can be heavy on the server, and means that users will generally store lots of their mail (not just their current undownloaded inbox, as is more customary with POP3) on the server too.

I've seen IMAP supported by ISPs, but in the POP3 sense; ie, you have a single mailbox (INBOX) and can't create any new folders.

Hugo
random fact: I wrote the of the EPOC ER5 IMAP client (not the UI, just the part that does the IMAP) during the early days of empeg... this is the one in the Psion Series 5MX and the Ericsson R380. Met lots of the IMAP server people including Cyrus at the IMC meeting in '99 which was in the same building as the LinuxExpo :)