Newest challenger to iOS and Android software dies before leaving the gate

Acadine Technologies, a startup trying to give phone users a software alternative to the dominant powers of Google and Apple, is on its last legs.

With no new funding in hand, last month's warnings of possible layoffs at Acadine are materializing. The company's entire engineering staff will lose their jobs this week. In addition, the Hong Kong-based startup is warning business partners it is ceasing work for now on its H5OS mobile operating system, according to a copy of a message seen by CNET.

"Due to an unforeseen situation, where we did not receive the funding that was contractually committed to us, all engineering work on H5OS will be suspended at Acadine immediately," the company told business partners such as mobile phone chipmaker Qualcomm over the weekend. "This is a very unfortunate situation that we have not been able to find a way to avoid. We deeply appreciate all your support for us in the past 12 months."

Think of it as the second death of the Firefox OS. Executives from Acadine had left Mozilla, best known for the Firefox browser, to build a variation of the operating system with the hopes that it could power smartwatches and lower-end phones. Acadine hoped to build an alternative to potentially loosen Apple's and Google's grip on the market -- even though most people seem happy with their iPhones and Android devices.

As Apple and Google accumulate power, though, it's harder for customers, app programmers and business partners to try something different. In principle, Acadine's Web-based technology offers more openness when it comes to items like writing apps, choosing messaging tools and distributing music and video.

Acadine made some headway, setting up offices in Hong Kong, China, Taiwan and Palo Alto, California. It had hired more than 100 employees and had signed up customers to use H5OS in phones and smartwatches geared for the North American market. But the effort faltered when Acadine received only an early fraction of the $100 million it thought it had raised from Tsinghua Unigroup International, a Chinese investment firm.

Tsinghua Unigroup was angling for a controlling stake in Acadine, but negotiations proved fruitless, people familiar with the situation told CNET in April. The uncertainty surrounding Tsinghua Unigroup's stake has hampered efforts to raise other funding.

"Acadine is negotiating with other investors, but that wasn't proceeding fast enough to avert the situation," one person familiar with the situation said.

It didn't help that Mozilla scrapped its own effort to build Firefox OS for phones. And though it's possible that Acadine could come back with fresh funding or see its technology come to fruition through a licensing deal, Acadine's prospects now seem dim.