Stansted is indeed a fine airport, but it is in a sparsely populated rural area. Southend has a population of over half a million within a 15 mile radius reaching out to Basildon and Rochford. Push that closer to a million once you reach Thurrock and Chelmsford. So one of the reasons for Southend Airport is to serve the needs of its immediate catchment and prevent them having to trail across Essex or around London. Another reason is to provide employment for a region whose employment opportunities have declined in recent years. A third is to provide a convenient gateway to London for foreign visitors, especially from the Netherlands, Germany and eastern Europe. A fourth is to make money for Stobart Group who have bravely invested in a time of recession.
The rail connection from SEN is only a few minutes longer than from Stansted and the speedy passage through the terminal makes up for that. This may change as the airport grows, but I can't see it growing much above 2.5 million pax a year anyway. It is no threat to any other London airport and is perfectly viable.