That's not a Last.fm issue, that's a general trend that affects everything.

People don't blog on their personal sites any more, blog comments don't really exist any more, MySpace / Tumblr like sites are not popular any more and people don't share everything private on social media any more as everyone realized that the internet is not always a friendly place and there's enough public cases where this fired back.

The same also applies to the platform itself, opening yourself up to more user contributed data is often a real headache as you need to moderate it properly and that needs resources too. Ask Meta's moderator team how much fun they are having.