One of the reasons they have little competition is because much of the value they deliver is in the form of the POS (Point-of-Sale) systems they provide restaurants. I don't think those are even mentioned in the article. They also have a decent sales organization on the ground pushing their wares and providing training. They offer some analytics. (Etc. Etc. Etc.) Most blogs and magazines significantly simplify the business model or value proposition of companies like this so that they can tell the story in the space of one article...
I'm not saying that there isn't an opportunity for a competitor...but I think many people dramatically underestimate what it takes to go into markets like this and compete. To be a bit snarky, a cloud-hosted Rails/Django app is not the answer to every question, and not EVERY market can be conquered with just software, ramen, and ambition ;-) It's not simply a matter of someone throwing up a CRUD site to undercut them on price and then watching the checks roll in. Yeah, it looks easy to compete with them after reading one of these articles, but they are doing many things that it would be difficult for a small (and likely underfunded) startup to do. A team of 2-5 just isn't going to have the time or bandwidth to unseat them unless they have another trick up their sleeve. I think there are many better opportunities for YC-style startups out there.
I didn't realize this before but the reason why we can use Open Table to lookup availability in real-time and make reservations at a participating restaurant is because Open Table is the restaurant's back-end management system.
"We like to remember the clients' birthdays, their favorite tables, their likes and dislikes. With OpenTable you don't have to keep it in your head, it's all there in front of you."
