Apple is discontinuing their Xserve line of server computers—they'll stop selling them on Jan. 31. Folks looking for an Apple server have two options: a Mac Pro or Mac mini configured as servers with OS X Snow Leopard Server.
Given that the mini is their "most popular server platform by far," it's not too surprising. [Apple]
DISCUSSION
As far as hardware is concerned, the Mac Mini and/or Mac Pro can
replace an XServe.
But as far as power and small size (that fits in a rack nicely) the
XServe was the way to go.
I'm sure it wasn't their most popular model, but it really is a
shame. Now large companies would have towers taking up space
instead of the slim XServe.