This is a project I followed pretty closely at the time and I always felt it was doomed. There were probably 100 reasons it failed that I wasn't aware of but it seemed at the time like people really wanted the open software and platform but OpenMoki got religious about hardware which no one really wanted or cared about. Ultimately this was the route Android went and we see the results.
It is classic for FOSS wonks (I am one!) to forget that most people don't care about the principles of FOSS, they just care about the practical implications of FOSS which aren't always the same thing.
If you really want an open software and platform (statement 1) you care about the principles of FOSS (a contradiction to statement 2), since if you only want some specific side benefits that FOSS provides, there exist "better" (quotes because as an FOSS fan these are note better) options.
"If you really want an open source platform" is interpreted to mean different things to different people. Open source may literally mean "open source" without the associated zealous frothing at the mouth RMS association. No contradiction here.
There's the community and then there's paying customers. The former want open software and platform, the latter want a functioning phone. They're both "people", but they're not necessarily the same "people".
> it seemed at the time like people really wanted the open software and platform
is true, there should nevertheless be a sufficiently large audience. The product will perhaps never become mainstream, but the audience should be sufficiently large that a company can survive on them as customers.
It is classic for FOSS wonks (I am one!) to forget that most people don't care about the principles of FOSS, they just care about the practical implications of FOSS which aren't always the same thing.