I'm probably going to be the sole wet blanket here.
Ask yourself this question. Will your product be substantially different from this competitor's product?
If yes, you might want to do something else. Like what you said, this competitor has growing traction. It'll be difficult for you to break the momentum especially if you provide nothing different.
If you really want to fight with this competitor well, you must offer something different to the users. Eg. tumblr or posterous is like a super-easy lite version of wordpress. That's why they're gaining traction. There are probably XXX number of blogging systems out there that are similar to blogger/wordpress and they just can't break through. Those that broke through differentiate themselves well from these existing services.
dropbox is not like the hundred other online storage site. Their interface is brain-dead simple compared to the competition.
Will your product be so? That's the question you have to ask yourself.
I'm not saying this to be a spoilsport but to help you prevent wasting your precious development time.
Takeaway point is similar to what the others have said:
- Learn from your competition and differentiate yourself from them
- There are competitors all the time. So learn to live with them and out-execute them.
- Being late to the party is not a problem as long as you execute well (See dropbox)
Another good example is Box.net. They were in a crowded space. They were not first but they differentiate themselves from the competition by offering an easy + social UI that makes sharing fun. It all boils down to execution.
Ask yourself this question. Will your product be substantially different from this competitor's product?
If yes, you might want to do something else. Like what you said, this competitor has growing traction. It'll be difficult for you to break the momentum especially if you provide nothing different.
If you really want to fight with this competitor well, you must offer something different to the users. Eg. tumblr or posterous is like a super-easy lite version of wordpress. That's why they're gaining traction. There are probably XXX number of blogging systems out there that are similar to blogger/wordpress and they just can't break through. Those that broke through differentiate themselves well from these existing services.
dropbox is not like the hundred other online storage site. Their interface is brain-dead simple compared to the competition.
Will your product be so? That's the question you have to ask yourself.
I'm not saying this to be a spoilsport but to help you prevent wasting your precious development time.