How many acquisition channels has he investigated? Adwords is a pretty expensive one that only works for certain types of products. He tried that. What else? Hard to comment on his actual idea. Assuming he has competition, that means someone has figured out how to find customers in a scalable way.

Maybe his idea, with a 10 degree pivot, could be a viral/SEO sensation. I've no idea.

But certainly some ideas lend themselves better to cheap/free customer acquisition.

GREAT snippet from Patio11's blog (paraphrasing Seth Godin):

"Specifically, he says that the software business is undergoing radical changes because technical competence is no longer a scarce commodity: with open source tools, an increasing supply of trained programmers, and the explosion of cost-lowering innovations for creating and marketing software on the Internet, things which were previously the purview of a technical elite are now within what talented teenagers can cook up from their kitchen table."

A good web app is really only the "entrance fee" to the more challenging (and longer term) game of building a business.