Michael Arrington notes that the folding of Google Answers was a big win for Yahoo and for the Web 2.0 model. But it's also a milestone for Google in that it shows they're willing to kill off projects operating under the wrong concept.

Google Answers launched in 2002, at a time when the desire for cheap user generated content wasn’t valued much because the advertising market was in a slump - monetizing page views was much harder than it is today. They adopted a for-pay model, where experts received a fee for answering questions, and Google took a 25% cut. ...

This is a case study in why all this “Web 2.0 stuff” actually has legs when applied properly. Google went for a direct revenue stream, a business model that made sense in 2002. Yahoo, launching much later, launched a free product and used the ideals of community participation to remove friction from the process and get out of the way of users. This incentivized use and has created a massive number of page views that Yahoo is now monetizing. The network effect kicked in big time.

Finally, the move shows that Google wants to see performance out of its projects - 20 percenters or not - and is willing to pull the plug on stuff that just doesn't work. Perhaps not a great sign for Google Video.