The point was to eat the bottom of the cellular phone market, as Mozilla saw Blackberry dying, Ubuntu Touch & Android requiring way too much resources, and Windows Phone killing Meego yet not succeeding in retaining Nokia's marketshare.
What Mozilla built was an OS that could run on very basic hardware (eg: what an OEM can build for $5 to $10) and be more usable than the alternatives out there that were even more expensive.
A price war led by Mozilla was never going to pan out without buy-in from the OEMs and cell carriers, but after Mozilla ditched the project, Qualcomm seems to have decided KaiOS is the only reasonable thing for basic phones to run, and Google is funding it just enough to encourage integration of some Google services.