I think there is a very real danger of competition eating your lunch, but you can't let it frighten you too much, or let it stop you from executing on a good idea. It has been my experience that large companies sometimes lose their ability to rapidly iterate on a product. Maybe it's not even in their best interests -- if you have a killer product like Gmail, there's not a strong motivation to stray too far from the course. It leaves room for companies to take those risks, and find out where there is room for innovation.
