As you'll recall, the company had this grand vision of changing the way that people shop for a phone. The idea was to build the store around the devices - the Nexus One, initially - and then allow the customers to choose their own carrier. The site started with T-Mobile but was expected to add Verizon and later Sprint, as well as Vodafone for overseas customers.
So what happened? Google explains it best in a blog post:
While the global adoption of the Android platform has exceeded our expectations, the web store has not. It’s remained a niche channel for early adopters, but it’s clear that many customers like a hands-on experience before buying a phone, and they also want a wide range of service plans to chose from.
And so, the company will make the Nexus One more readily available through retail stores and will shift the online "store" to more of an online "showroom," a place where users can check out all Android phones.
I wasn't a fan of the online store from the beginning, even though I had initially been very excited about the Nexus One. But I will give Google props for giving it the old college try. Consumers have long squawked about the carriers and long contracts and early termination fees and so on. Google was trying to provide an alternative.
So here's an "A" for your attempt at doing something differently. Let's make it an "A+" for recognizing that it was time to cut your losses and get back to the business of making Android even better than it already is.