The Hudson guys have worked out the future of the project. It's going to gently move off of Oracle's servers, and be renamed Jenkins. It looks amicable, but is forced mostly because the project maintainers don't want to allow Oracle control over the project if it does something Oracle doesn't like, from the looks of it.
Oracle has told us that they have trademark applications filed in both the EU and US for Hudson, based on Hudson's creation by Kohsuke while working at Sun. The problem is that this trademark ownership gives Oracle the ability to revoke the Hudson project's right to call itself Hudson at any time, and while Oracle has made an attempt to offer some guarantees (most notably, that binary releases of Hudson, once they've been released with the name Hudson attached, will always retain the right to the name), they are not offering any binding guarantee that the Hudson project will be able to retain its use of the name in perpetuity.
Therefore, to continue using the name Hudson means ceding some of the project's independence to Oracle - if the project and its governance board opted to go in a direction Oracle disapproved of, Oracle would be able to take away the naming rights. Or, in a less dramatic scenario, Oracle could insist on certain changes to the code, infrastructure decisions, process, etc, regardless of opposition from the Hudson development community, in order to retain the rights to the name.
While it's rather depressing to have such a conclusion, it's been likely from the very beginning: even if Oracle hadn't owned the name (which was originally questionable, but isn't questionable NOW unless you're slightly delusional), chances are the Hudson maintainers wouldn't have been able to fight Oracle if things got "difficult."
This is a sad, but logical and satifactory resolution to the problem. Jenkins has a similar feel to the name (as the blog entry indicates), and the future of the project is in good hands: the original authors'.
It's possible that some will see this as a fork rather than a rename. Certainly, Oracle has the right to continue development under Hudson's name, in a different source tree. However, with the original authors working on Jenkins, chances are good that the new project will propagate well, under a different name, and the project will continue to have a bright future.