I'm personally troubled about the right attitude towards competitors... I but I think it's:

Don't worry about competitors. Worry about making something people want.

Constantly improving your product, for what your users want, automatically protects you against competition. I also find that worrying about competitors (instead of customers) can lead to a self-defensive mindset.

If [users] take you up, no competitor can keep you down. http://www.paulgraham.com/startuplessons.html