Not necessarily true, Etherpad is pretty solid. If they shifted some of the dev talent away from their silly attempt to make a online music store to something genuinely useful like real-time collaboration i can see that working in their benefit, at least to business users.
If Canonical is serious about promoting their cloud platform this should be relatively easy for them to host and roll client access into their next desktop release. They could also host the server component in their repo to make it cake to install on internal servers as well. Wave without the "Google" would be awesome.