When you fail to meet your project requirements by a certain deadline, its usually best to cut your losses. Continuing to throw money at it likely will gain no progress, and cost you even more time and resources. Re-evaluating the scope of the project and starting over fresh, while retaining some things from the failed project, might be a viable option for them. Again that will cost a lot of time/money, and at this point they might not feel its wise to invest it into something that again won't be a guarantee.
I think it is pretty obvious that these guys had a distinct vision and had specific requirements for their project. Solutions that don't fulfill these things aren't really solutions. They might not be very different to the users but to the developers it just isn't what they want.
It would probably just be best to sit back and relax and see where they go with it.
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