Monopoly wasn’t a goal for Wikipedia, it’s something that just happened.
There’s basically no way at this stage for someone to be a better Wikipedia than Wikipedia. Anyone else wanting to do a wiki of educational information has to either (a) vary from Wikipedia in coverage (e.g., be strongly specialised — a good Wikia does this superlatively) (b) vary from Wikipedia in rules (e.g., not neutral, or allow original research, like WikInfo) and/or (c) have a small bunch of people who want to do a general neutral encyclopedia that isn’t Wikipedia and who will happily persist because they want to (e.g., Knowino, Citizendium).
Competition would be good, and monopoly as the encyclopedia is not intrinsically a good thing. It’s actually quite a bad thing. It’s mostly a headache for us. Wikipedia wasn’t started with the aim of running a hugely popular website, whose popularity has gone beyond merely “famous”, beyond merely “mainstream”, to being part of the assumed background. We’re an institution now — part of the plumbing. This has made every day for the last eight years a very special “wtf” moment technically. It means we can’t run an encyclopedia out of Jimbo’s spare change any more and need to run fundraisers, to remind the world that this institution is actually a rather small-to-medium-sized charity.
(I think reaching this state was predictable. I said in 2005 that in ten years, the only encyclopedia would be Wikipedia or something directly derived from Wikipedia. I think this is the case, and I don’t think it’s necessarily a good thing.)
The next question is what to do about this. Deliberately crippling Wikipedia would be silly, of course. The only way Wikipedia will get itself any sort of viable competitor is by allowing itself to be blindsided. Fortunately, a proper blindsiding requires something that addresses structural defects of Wikipedia in such a way that others can use them.
(One idea that was mooted on the Citizendium forums: a general, neutral encyclopedia that is heavy on the data, using Semantic MediaWiki or similar. Some of the dreams of Wikidata would cover this — “infoboxes on steroids” at a minimum. Have we made any progress on a coherent wishlist for Wikidata?)
But encouraging the propagation of proper free content licences — which is somewhat more restrictive than what our most excellent friends at Creative Commons do, though they’re an ideal organisation to work with on it — directly helps our mission, for example. The big win would be to make proper free content licenses — preferably public domain, CC-by or CC-by-sa, as they’re the most common — the normal way to distribute educational and academic materials. Because that would fulfill the Foundation mission statement:
“Imagine a world in which every single human being can freely share in the sum of all knowledge. That’s our commitment.”
— without us having to do every bit of it. And really, that mission statement cannot be attained unless we make free content normal and expected, and everyone else joins in.
We need to encourage everyone else to take on the goal of our mission with their own educational, scientific and academic materials. We can’t change the world all on our own.
So. How would you compete with Wikipedia? Answers should account for the failings of previous attempts. Proposals involving new technical functionality should include a link to the code, not a suggestion that someone else should write it.