So I read through the whole account, and the whole original thread on logopond. And hindsight is always 20/20, so take this as you will.
First, you never asked if people would pay. I only saw one mention of money exchanging hands in the thread, and it was from someone saying that they wouldn't pay unless it had been proven rock-solid from a legal perspective.
Second, how many people actually landed on the signup page during the time you had the beta up? I think devs often hit the trough of despair and rush to add new features, when the real problem is that they just don't have enough people coming in the front door.
Sorry it didn't work out, though. What's your next project?
That's off the point. Virtually no one who asked or cheered for the service ended up even trying it. I conversed with many designers privately beforehand and they were unanimously saying that - yes, this is something that I've been waiting for and something that I would personally use a lot.
The takeaway here is that the community validation of an idea may not meaning much, even when it is very explicit.
I see what you're saying. You're saying that it's a moot point because you asked if they would use it and they said yes, but then they didn't actually use it.
But the thing you have to guard against most in customer development is a false positive (am I using that right?), where people say they will sign up, buy, whatever, but then they don't. So anything you can do to get closer to a fully validated yes is worth it.
Lots of ideas are neat and things I might say I'd use, but will I whip out my credit card and give you $20 / month or whatever? The ideal is to get a commitment to pay before you build (prepay, pay $1 for the beta, kickstarter, whatever).
However, I think if you had really asked that question and really hammered whether they'd PAY, you might have gotten a little more honesty about whether they would actually value it. You wouldn't have gotten perfect honesty, but I bet the enthusiasm would have waned significantly if you had asked "would you pay $20 / month for this" instead of "would you use this".
But sometimes it just sucks and it goes wrong in the end no matter what you do.
I'm working on a project that's very similar in terms of stage, needing to be validated, uniqueness, etc. So my plan is to reach out to a ton of people, see if they have the problem, see if they'd pay for the solution, and then build a landing page with a giant price on it and see if I can get people to click on the sign up button. Before I write a line of code. I'm tired of building things no one wants or will pay for.
That is why it is better to get a website way before development begins and get interested people to provide their email id to be notified of your launch. This will provide you an early indication of whether to continue or quit.
Careful with that. Been there, here's a postmortem - http://v4.swapped.cc/certtime