The Tango model of using extra hardware is probably much better, but seems further ahead. The software model works today on existing devices and lets people see how this is useful. Once you have that convincing people it's with the money to have the hardware added to the phone becomes easier.
Given how many Android phones are lower cost than the flagship was Tango ever going to be very popular? Apple could have forced the issue (like Lightning or the headphone jack) but people could always switch Android OEMs to get something cheaper if they don't see the value.