It appears that SketchUp was one of the thousand flowers that Google let bloom that isn't making it into Larry Page's bouquet. [1]

It's a good move for companies to shed products that aren't their core competency. Resources, and more importantly focus, are scarce and should only be used in activities which add the most value for the company.

[1] http://dcurt.is/googles-coherent-bouquet

Google gets money in exchange for ditching a potentially distracting side project that's likely to remain a small niche item.

And people get to keep their jobs.