Too late to tablet
Moshi Monsters wasn't a bad idea at launch but it failed at two things:
1) Was too late to adapt to working on tablets and phones. Having to use a desktop or laptop all the time absolutely hammered it. If they had the full service on tablets earlier they would have been doing far better.
2) They failed to adapt to a changing audience. While they always had the younger market sewn up, there was nothing for the early users who grew up. JK Rowling pulled it off with the Potter books but few others have managed it.