Leeann Prescott at Hitwise says that Google Blog Search traffic is overtaking Technorati's. She writes:
"This week Hitwise data show that the market share of visits to Google Blog Search surpassed visits to Technorati for the week ending 12/23/06. Google Blog Search began catching up to Technorati in October, when Google placed a link to Blog Search on the Google News home page, causing a 168% surge in market share for Google Blog Search over a two week period (week ending 10/14/06 vs. week ending 10/28/06)."
Mike Arrington at TechCrunch, however, takes a look at the Comsore data and says:
"Comscore tells a much different story, and one that makes little sense given the facts. The most recent Comscore data (November) says Technorati had 3 million page views v. Google Blog Search?s 1 million. But Comscore also shows highly erratic Technorati data over the last twelve months, swinging from a high of 22 million page views in April 2006 to a low of 1 million in December 2005."TechCrunch commentator Andrew posts a link to Quantcast's data and wonders "if it's accurate that Google Blogsearch has a lot more regular users than Technorati (relatively)"
Susan sez: This makes me wonder about how Technorati's strategy needs to evolve. Clearly, any shopping around of the company hasn't resulted in a deal, despite the huge number of roll ups going on, and now a big Gorilla can use the power of the homepage (TPHP, to coin an acroynm) to drive users there. What's a indie to do?

Technorati's already deep down the road with partners like Edelman and Associated Press, but they've never actually-IMHO--pulled together a strong white label and partner strategy.
If it were my company--or my client--I'd advise them to take a hard look at how they can build a partner strategy that will drive audience growth in a way Google cannot match.