At this point we know that Google is planning to shut down Reader as of July 1, 2013. We also know there at least 50,000 users that were willing to sign a petition in an attempt at keeping it around. What many might not know is why. The first thought for many is in regards to money and the bit about Reader not making anything for Google. Simply put, that is not the case.
The answer, or at least one persons take has recently been shared on Quora. That person is Brian Shih, who is now the "Former Google Reader Product Manager." Sad title aside, Shih has said that this had "nothing to do with revenue vs operating costs" and in fact, that "wasn't the goal of the product." It seems some of the reasoning here was due to social sharing and the rest was due to Google+.
Shih tells the story of Google almost pulling the plug several times. In 2008 the Reader team was pulled to work on Open Social, in 2009 they were pulled for Buzz and in 2010 they were pulled for Google+. Though it was also said that "most of the engineers opted against joining G+." Basically, it seems that Google Reader has actually been on life support and that it has been in maintenance mode since 2010.
Further details note that Shih believes that after Google switched the sharing features over to Google+, which came along with a redesigned user interface, that his "guess is that usage just started to fall -- particularly around sharing." We know how Google likes sharing, but is seems some of this was also tied to flat usage and Google's drive on focus.
Otherwise, he also notes that Reader was "pigeonholed as an RSS-reader explicitly, and didn't have a chance to grow beyond that to explore that space." Of course, in the end this does not mean anything except to give those faithful users some sort of explanation as to why. But in the end, explanation or not, it still looks like you will need to find an alternative before July 1.