What's the problem? Most of the difference between success and failure is marketing. This is a great way to take advantage of the momentum of his previous application.
But I'm a little surprised that you pivoted from an original and successful idea to an unoriginal and derivative idea.
Your priorities are not aligned with the developer's, me feels. You are worried about being "original" and not derivative--both only tangently related to financial success, which is what the creator seems to be after(and good for him!).
It seems like the developer just gave up. I would have collected everyones email and told them that they will be notified when everything is fixed, or just have created the same service under a different name to challenge facebook to shut it down again.
Exactly. Foursquare was hardly the first service of its kind. I think most would agree this is potentially a great idea, but it's never caught on.
Why not? I'd bet one major reason is that almost nobody has even heard of the previous efforts. You've got to get the specifics right, and you've got to establish it as a popular thing to do. Then lots of fun may ensue.