Despite what that wiki page says, I never said anything was wrong. I did not put forward my own view, only what I thought BazJJ was referring to.
The thing is though, as you put it, if the cheaper site is up to spec, then it's exactly what I was talking about.
The negativity in this does require a pre-existing competitor, it's not a given that a new company is undercutting because they are cheaper, but if the quality is good - then I believe it is more likely. If you offer an equivalent service, you have to price competitively, if you offer a good, but inferior service you do not. But remember, in my opinion, you first have to analyse the playtime to cost ratio before you look at anything else.