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.
I had very high hopes for Wave. It had implementation issues, but the idea of re-thinking the e-tools we use daily, e-mail, wiki, discussions, etc was valid and I liked Wave's approach. Wave used an open backend so it could be easily replicated elsewhere. While they provided the first UI, others would have been free to create their own UIs for the service as well. There were some usability issues with Wave's web-UI that I mentioned previously, but those were details they could have worked out over time.
Wave seemed to suffer from the chicken and egg problem. They perhaps should have let it cook a while longer and opened up to more people sooner. In the end, though, it may have been too radical a step for most users to adopt.