He's saying that non-techies don't realise that Google Reader != RSS. So won't seek an alternative rss product, hence blogs losing lots of readers. The apocolypse refers to that. I suspect that won't happen as plenty of 'alternative to google reader' articles popping up.
"I remember back when RSS was amazing and something you paid for. I also remember when Google Reader showed up and very quickly started taking over. It was free. It was Google (back before we were all scared of Google) and it wrecked the market for all of the paid RSS services."
His last sentence:
"This whole mess is just another example of why free is so often bad."
I see what you're saying, that he thinks users are part of the mechanism, but the bottom line is he thinks this apocalypse can be traced back to Google Reader being free.
