People didn't want to fly from Australia to Japan via a regional port, on a narrow body jet, without flatbeds in business, without seatback IFE in any cabin, without international lounges, without any service in economy aside from tea/coffee/water, where onward connections on the local partner (ANA) are similarly lounge-less for Velocity elites... wow, who could have seen that coming. The experience sounded so very wonderful. 
Honestly, I'm surprised it lasted as long as it did. Pretending to be something better than Jetstar while arguably delivering a worse overall travel experience than Jetstar isn't exactly a recipe for success, unless you compete hard on price, but there goes any smidgen of a margin...
