...Wave has not seen the user adoption we would have liked. We don’t plan to continue developing Wave as a standalone product, but we will maintain the site at least through the end of the year and extend the technology for use in other Google projects. The central parts of the code, as well as the protocols that have driven many of Wave’s innovations, like drag-and-drop and character-by-character live typing, are already available as open source, so customers and partners can continue the innovation we began. (hit the source link for the full blog post)
Google believes that although the platform will no longer be supported, Wave's code will be implemented elsewhere in its arsenal (think Google Docs, Buzz, Me, etc). The Wave site will be maintained "at least until the end of the year." If you have current projects on Wave, worry not. Google plans to develop tools so you can "liberate" your content from Wave. Furthermore, since Wave's code is open-source, the community can amend and improve it in the future, if there is such a desire.
So, who here will miss Google Wave? Did Wave suffer an untimely death, or was this merely a move by Google to cut some dead weight?
source: Google Blog