First of all, Preds GM David Poile is one of the best in the business.
Aside from that, I think they feel like Dante Fabbro is ready to step into the top 6 without missing a beat. He came in and played very well down the stretch last year and has an entry level contract. There have also been rumors for while now that Subban has worn out his welcome in Nashville. Not sure what it is about him, but the same thing happened with him in Montreal. I also doubt there was a very high demand for him considering his age and current contract.
Lastly, as others have said, this frees up a lot of cap space to give Josi a big deal and potentially go after an impact free agent.