Because the smart way (with "M" there instead) was patented. From TFA (emphasis mine): > In order to evade the patents that were assigned to the Type Writer Co

Because the smart way (with "M" there instead) was patented. From TFA (emphasis mine): > In order to evade the patents that were assigned to the Type Writer Company, WS&B slightly changed the design of No. 2 including the keyboard arrangement (Fig. 9), where M was moved next to N, and C was exchanged with X. It was the QWERTY keyboard arrangement as seen nowadays.