Biden has the luxury of being an incumbent. Lots of traction comes with that.
Staying COMPLETELY out of the picture, allows all energy and mud to be expelled at Hillary.
Once she has been used up, Biden can come in as a sort of savior to the democrats. Thus avoiding 6-9 months of bashing.
Plus, with Hillary beaten up, the Dems/Biden will be viewed as underdogs. IE the sympathy/outrage vote.
I thought Biden would be a shoe-in on the Dem side. He is certainly way more likable than Hillary. But it seems he chose to sit this one out. Maybe due to the death of his son, maybe he's just ready to retire. Who knows.