[ghaff]

Google makes some IMO very weird decisions about seemingly low effort/cost offerings, even if a bit niche, that would seem to be very complementary to products/services that it does put its full weight behind. Dropping Reader didn't make a lot of sense to me for this reason. The lukewarm support for Scholar is another.

[Filligree]

Google's infrastructure is geared towards making enormous services cheaper to run, at all costs. As a result, the maintenance burden of Reader was far higher than you might have expected.

That should explain at least part of the decision.