You should read the competition and talk the customers, not the other way round. Also, you shouldn't work for competition, you want to work for customers. That's the post point.
Hola Paul, who is wrong?
Me or the CEO of TellMe? :-)
PG and nivi have two ends of the stick.
Think about the competition when talking to your customers, not when talking to yourselves. Don't anthropomorphize the problem. Focus on the problem space, not the people that populate it.
Getting new ideas doesn't just mean getting ideas to copy. If the competition is really lame, studying them can be a way to learn what's good about what you're doing. Often you're doing something right unconsciously, and don't even realize it till you see someone not doing it.
What you don't want to do is change your direction to do something just because competitors are.