Google/Jaiku Pre-Logo Straight from the horses mouth:

Google acquires Jaiku

Jaiku is joining Google. While it's too soon to comment on specific plans, we look forward to working with our new friends at Google over the coming months to expand in ways we hope you'll find interesting and useful. Our engineers are excited to be working together and enthusiastic developers lead to great innovation. We look forward to accomplishing great things together. In order to focus on innovation instead of scaling, we have decided to close new user sign-ups for now.
But fear not, all our Jaiku services will stay running the way you are used to and you will be able to invite your friends to Jaiku. We have put together a quick Q&A about the acquisition.
Jyri Engeström and Petteri Koponen, Jaiku Founders

The rest of their FAQ concerning this event doesn't reveal much.
Wow. I didn't see this coming. I knew Google was rumored to release something that was social networking-esque on November 5th, but I was totally caught off guard. I am a user of this type of app, in that I have Twitter, Jaiku, & Pownce accounts. Out of the three I prefer Pownce but don't use it as much due to lack of mobile support. Jaiku seems a bit too cluttered for me due to the ability to tie all of your personal RSS items into your feed. Twitter, on the other hand, has mobile support & the largest user-base of the three. I think Google would have been better off buying Twitter but the price Twitter named was probably way too high.

Robert Scoble has his reaction here:

I was talking with a Google employee last night at the Graphing Social Media conference.

Aside: why are there more Google employees there than Facebook ones? I think Facebook’s attitude toward the community is saying volumes to all of us.
Anyway, he asked me to guess which Google service had the most page views every day.
Is it search? No.
Blogger? No.
Google Maps? No.
Picasa? No.
So, what is it?
Orkut.
Orkut?
Yeah. Now do you get why they just bought Jaiku?
Now do you get why the world is going to pay attention to what Google releases on November 5?
Yeah!
Facebook has real competition coming. Competition they haven’t yet faced.
It’s going to be an interesting period to watch them go at it.
I have 552 reasons to hate Facebook. I sure wish they would let me add more than 5,000 friends. If Google doesn’t have such a stupid limit that’ll get me to check it out, at minimum (I can’t add any more friends on Facebook).
A few months ago I interviewed the Jaiku founders. I found them to be very smart. This is a good purchase for Google. Add it onto their new social network that’s coming (Orkut 2.0) and Google just made a major move against Facebook.

Update: Michael Arrington has just posted his breaking news post over at TechCrunch. While it doesn't reveal anything than what we already know, he does chime in with:

The terms of the acquisition have not been released.
This is a fascinating move by Google which would have looked at Twitter prior to this acquisition, and Twitter’s recent $5 million series A funding last July.
There will be inevitable comparison’s with Google’s acquisition of Dodgeball, which largely came to nothing, but it would appear that the time for social networking and blogging via mobile has come. Google’s ability to add scale and marketing muscle to Jaiku should be putting Twitter on the back-foot right now.

Update 2: Om Malik over at GigaOM has posted some thoughts as well

Update 3: Leo Laporte has posted over at the Life of Leo.

Update 4: From the official Google Blog:

Posted by Tony Hsieh, Product Manager
Technology has made staying in touch with your friends and family both easier and harder: living a fast-paced, on-the-go lifestyle is easier (and a lot of fun), but it's more difficult to keep track of everyone when they're running around at warp speed. That's why we're excited to announce that we've acquired Jaiku, a company that's been hard at work developing useful and innovative applications for staying in touch with the people you care about most -- regardless of whether you're at a computer or on a mobile phone.
Current Jaiku users can still use the service normally, and new folks can sign up for an invitation to the service when we're ready to expand. We plan to use the ideas and technology behind Jaiku to make compelling and useful products. Although we don't have definite plans to announce at this time, we're excited about helping drive the next round of developments in web and mobile technology.
We wish a hearty Google welcome to Jaiku, and are looking forward to working together on new and innovative ways of keeping people connected.

More blog responses:

The ZDNet blog, Between The Lines by Dan Farber.

ReadWriteWeb by Marshal Kirkpatrick headlined as Google Acquires Microblogging Service Jaiku.

/Message by Stowe Boyd.

& Ross Mayfield at his blog.

Update 5: From Mashable:

Breaking: Google Acquires Jaiku, Why Not Twitter?

Jaiku has announced that it has been acquired by Google. Jaiku is the Twitter-like service for keeping up with your friends via the Web or SMS. Terms of the deal are not being disclosed by the companies.
According to Jaiku:
“Exciting news: Google has bought Jaiku today.
What does that mean? First and foremost, we’re of course continuing to support our existing users. So fear not: your Jaiku phone, the Web site, IM, SMS, and API will continue to work normally.
That said, new user sign-ups have been limited for the time being. The idea here is to enable our team to get right to work with Google’s engineers on delivering a new, better service to you as quickly as we can instead of spending our efforts on optimizing the current back-end. Existing users will still be able to invite their friends, and those who are not yet on Jaiku can send us a request for an invitation to join.”

This is somewhat surprising news considering the perceived dominance of Twitter in the so-called “lifestreaming” space. Additionally, Twitter is co-founded by Evan Williams, who was the creator of Blogger, which was previously acquired by Google. In a world where price is no object for Google, it’s interesting that they would opt for Jaiku and not Twitter.
In addition to continuing its acquisition spree, the move marks yet another development in Google’s mobile ambitions. Earlier this week, reports of the company’s entry into the mobile operating system market went mainstream, while they also recently acquired mobile social network Zingku. Other Google acquisitions this year include DoubleClick, FeedBurner, and GrandCentral.
Jaiku was founded in February, 2006 by Jyri Engeström and Petteri Koponen.