I was also sad when Google Talk was shutdown for Hangouts but to be honest, XMPP was going nowhere. The quality of available clients was very different. You had awful clients like Apple iChat (which is still awful), complete client like Psi which stopped at some point, clients which wanted to be everything like Adium/Pidgin, etc. pp.
Google Reader was indeed sad and really weird, they could have build on top of their social networks they already had but they wanted something new and shiny. I still look for a good replacement.