You do not need differentiation for competition. It’s called perfect competition and it’s a race to the bottom for price, which is the ideal outcome here.
Remember when mobile carriers were competing via "differentiation"? Practically, that meant waiting on firmware updates for months or years, having to deal with preloaded and non-removable crapware on mobile OSes etc.
Now they're largely "dumb pipes" competing on price and quality of service, and as a consumer I couldn't be happier. (Of course, there are now different gatekeepers on our phones, but that's a different discussion.)
