This example has been beaten to death. Google was at least an order of magnitude better than other search engines, and was the first that actually worked, so it didn't matter how crowded the space was.

When evaluating an opportunity, "___ is a competitive/crowded space", "___ has already won this market", or "does the world need another ___" are all valid objections to raise. The rebuttal should be "but ___ is better/different because of ___" rather than a comparison to Google.