Adena Schutzberg at the All Points Blog has an excellent summary ("in Plain English") of the Google/ESRI announcement (represented by John Hanke and Jack Dangermond, respectively) at the Where 2.0 2008 Conference. My summary of the summary -- Google and ESRI are (or appear to be) warming up to each other more than at any other point in the past.

Do read the whole thing, though.