This decision is hardly surprising. Silverlight was pretty much doomed from the start. It was a rival to a well-established, if flaky, technology — Flash — and pretty late to the party, so to developers not wedded to the Microsoft ecosystem (and that means 90% of web developers and designers), it was a great big yawn. And its prospects were effectively killed off when Apple decided to ban non-approved programming languages and frameworks from the App Store — therefore, no Flash, and by extension, no Silverlight. The iPhone and iPad are a huge market — if something doesn’t run on them, it isn’t cross-platform.
In the meantime, HTML 5 has come to the fore as a standard that looks set to render both these technologies obsolete. It is (partially at least, and increasingly) supported natively by web browsers without requiring any additional extensions. It’s an open W3C standard with a history spanning two decades, so it’s here to stay, as well as being a skill that can easily be transferred to other environments. XAML may be nice, but it has little or no traction outside of .NET.
For what it’s worth, this illustrates the risk of limiting your experience and skills to the Microsoft ecosystem. A lot of people have invested a lot of time and effort in becoming Silverlight specialists, and now they’re scared because it looks like those skills are set to become pretty much worthless over the next few years. I wouldn’t advocate ditching Microsoft altogether, but it’s always a good idea to be attentive to what’s going on elsewhere and not put all your eggs in one basket. Besides, if you’re familiar with what’s going on elsewhere, it can help to give you a better feel for which of Microsoft’s frameworks and technologies are likely to be a good long-term investment and which aren’t.