Perhaps it's a response to Roblox? It seems Roblox is bigger, and it really sold itself on the subscription model, being a safe place for kids and getting parents involved, etc.
Blockland is like an FPS with blocks. The multiplayer mode requires you to have a brain in order to host. The content isn't very tightly controlled. I doubt LEGO would try and compete with it because it can't both compete and maintain the same company image. Any game they tried to make would need tightly controlled content and servers, would probably not have the ability to make modifications, etc. All in all it would appear that Blockland was a better game.