As to whether it succeeded or failed: I thought it seemed to be a success for a while, then it seemed interest tapered off. Maybe that had to do with how generic the system was (when there's a lot of "Generic" Modern systems out there), or maybe the lack of full campaign support (instead of fully detailed and dedicated books to specific campaign worlds, they had kind of "Era" books with small writeups on different camapaigns, but only part of chapter devoted to each). Something I always felt was lacking also was miniature support. D&D was covered big time, and Star Wars got pretty good coverage also (and some could have been used for "D20 Modern" or "D20 Future"), but there were absolutely no miniatures made specifically for D20 Modern. (edit: there were however a few 3pp campaign settings for use with D20 Modern/Future)
The system worked pretty well for me though. I just adapted all of my Alternity stuff, especially my Star*Drive Campaign setting material. My original Dark*Matter books were useful also, I just used D20 Modern mechanics for everything.
I don't know if it can really be considered dead or not. There have been no new products or support for a considerable amount of time, and there really hasn't been any official word one way or the other from WoTC as to whether there will be a new edition. But, even though it's had no updates for almost 2 years, the D20 Modern page is still on the WoTC web page, and there still seems to be some traffic on WoTC D20 Modern forums. So, your guess is as good as anybody's.