Not everyone ignored it but unlike nfs it didn't come in the box with the operating system, and you had to pay for it. In addition, AFS provided strong cryptographic authentication and wire privacy which meant that it couldn't be licensed in many countries because the U.S. government did not grant appropriate export licenses.
I often wonder how the world would be different if AFS 3.0 could have been freely distributed world wide in 1989 precluding the need for HTTP to be developed at CERN.
There were a few technical obstacles which other people mentioned, but I think timing was biggest issue (remember--AFS dates to something like 1983-ish).
1) AFS, IIRC, required more than one machine in its original configuration. That meant hardware and sysadmins which were expensive--until, suddenly they weren't.
2) Disk, memory and bandwidth were scarce--and then they weren't. AFS made a bunch of solid architectural decisions and then wasted a bunch of time backing some of them down in deference to the hardware of the day and then all that work was wasted when Moore's Law overran everything, anyhow.
3) Everybody was super happy to be running everything locally to escape the tyranny of the "Mainframe Operator" (meaning no NFS or AFS or the like)--until they weren't. Once enough non-technical people appeared who didn't want to do system administration, like, ever, that flipped.
We lost the VMS filesystem in this timeframe, too. Which was also a distributed, remote filesystem.
Why did everybody ignore it, do you know?