It's hard to say why it's not doing well. It may be the case of an adjustment period needed by the moss. Often you see only the active growing portions of plants thriving and the older sections dying off.
How tight is the mesh/webbing on that stone? Not sure if that is the culprit. What you may want to try is untie the mesh, reposition the moss so it is laying flat on the stone, cover with the mesh, and re-tie a little looser. The growing tips will send new growth upward in about a week (or less).
I've grown flame moss successfully in less light. I have some in my shrimp tank. It also has a 24/7 that is turned down because of a hair algae problem. I've used fishing line to tie it to driftwood.
I once filled a 20g long with this type of moss (no carbon, no ferts, less than ideal water changes, single 17w fluorescent bulb...tank had tetras and goldfish in it). Corner to corner 4-6" deep. No idea what I was doing. I saved a portion and placed it in a jar next to a window. Oddly, the great mass of moss turned brown and died off a few months later. However, that culture I had in the window was just enough to start it up again.
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