This isn’t unexpected, and I am personally surprised it has been live for so long. That being said, the tool that launched on September 29, 2005 will be closing down “later this year” according to Hemant Minocha, Product Manager, Yahoo Site Explorer.
Yahoo recommends that webmasters sign up with Bing Webmaster Tools and use that as Yahoo shuts off Site Explorer.
Yahoo makes it sound like that you won’t miss the old Site Explorer but I find it hard to believe that Microsoft will provide detailed link data for competitors. Of course there are plenty of third party tools to get at this data, such as Majestic SEO and SEOmoz but with the loss of Site Explorer, there will likely be no search engine-provided look at your back links. Yahoo said:
The Bing Webmaster Center team has been actively adding new features over the past few months, including detailed traffic statistics and a new inbound links feature. Microsoft is also committed to build analytic reports that include Yahoo! search usage.
For more details, see the Yahoo Search Blog.