Yes. That was the single worst business decision in Google history, as somebody correctly noted. It burned an enormous amount of goodwill for no gain whatsoever.

Killing Google Reader affected a relatively small number of users, but these users disporportionately happened to be founders, CTOs, VPs of engineering, social media luminaries, and people who eventually became founders, CTOs, etc. They had been painfully taught to not trust Google, and, since that time, they didn't. And still don't.