I'll have to find other stories, but despite the headline I don't see anything flat out stating that /Sony/ has ended UMD. I've seen a similar story on GameSpot. and they're only reporting that while UMDs will still be made, they will make movies come free with memory stick duos as well.
Nevertheless, the format's life is limited for uses outside of video games. How the fuck did they expect this to succeed when only a video game system plays them, let alone the fact they're just mini-DVDs when they've already got cheap, affordable portable DVD players? I expect a few more monthes before Sony /officially/ shuts down production, espicially since it's going to be harder for them to sell them when no one else wants to.
Edit: The GameSpot story, for those curious.
To be fair, that /is/ typical PR crap, but still means they're not officially scrapped yet.