This is largely because of the lack of reward. No special items, just a bit of gil, a miniscule amount of EXP, and a title. And an achievement on the Xbox 360.The problem with this is lack of interest on most servers.
If you could get some items, even if they were only useful for PvP, interest would be higher.
If they continued to have the tournaments, interest would be higher. The winners in that DID get exclusive items- effectively the rarest in the game.
Removing old content does not accellerate development of new content. Ballista requires a miniscule amount of disk space. The two special areas for it are exact copies of existing areas and thus re-use the same textures at no additional space cost.If they deleted these events for more worthwhile updates, it would benefit the game as a whole.
They should not delete something because it's unpopular. They should do something to make it more popular, or they should just leave it alone, so those people who do like it can still have it.
Why do people do PvP (on PvE servers) in WoW? Because they get stuff for it. It's not the best stuff, so it doesnt harm PvE (and often the stuff they get is specifically for PvP). If you removed the rewards for battlegrounds in WoW, people would stop doing it almost instantly.

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