That service started in 2006 with the goal of providing a scalable and reliable way of hosting open source projects. Since that time, millions of people have contributed to open source projects hosted on that site. Nevertheless time have passed and other hosting options, like GitHub or Bitbucket, have gained greater popularity than Google Code.
No one can deny that Google likes to try new trends and technologies but the fact is that they have to keep happy their stakeholders so they end every service that doesn't stay high in popularity. Many high quality service have been shutdown by Google before Code's one: Notes or Wave are the first that come to my mind. Problem is that Google shutdowns services because they are not popular but some argue that they are not so popular because people and companies are afraid of Google changing its mind and closing service as time passes, so they don't use them. Who knows...
The facts are that since March no new project can be added to Google Code and that already existing project will keep their functionality only until August of this year. From there on, project data will be read only, an next year the site will be definitively shutdown although project data will be available for download in an archive format.
Those like me who have projects in Google Code have a Google Code Exporter to migrate project to GitHub and documentation to migrate to other services manually.
Many of my projects are rather outdated but I guess I'll import them to my private Bitbucket repositories to refactor them heavily and afterwards make them publicly available though GitHub.