For example, most people say that a social network site is a winner take all market and that FaceBook has it.
While they have the majority, Linkedin also has some share, Google+ has some share, even MySpace still has some share. All the competitors still have huge valuations relative to anything most people will ever do.
Further, Facebook doesn't have anywhere close to a monopoly on internet advertising dollars let alone all advertising dollars. There are many companies that earn money through "eyeballs".
Basically the Winner Take All Markets concept is an oversimplification, but still a great way to think about competition.
(actually, of the four types of companies i look at as an angel, my two favorite are "markets" and "networks")