Is it even Worth starting a New Niche

A niche is good, but to have an original idea in todays world is nothing short of amazing
 
This isn't an 'over optimization' penalty, that's just a clever way to disguise what they are doing. This is a "If you aren't a large authority site get the fuck out" penalty.
That maybe true in some niches, but definitely not all. I have a site in a competitive niche, dominated by government (.gov) authority sites, but rankings have remained the same (3/5 top spots) during the past few weeks.

Google NEED amazon, Walmart, Game and Ebay to advertise. We are chicken feed compared to them. If they win every battle for free then Google go bust - it's as simple as that.
Very true.

In 2011, Adwords generated Giggle $37.9 billion in revenue. The top 5 spenders in all of the biggest niches each have multi-million dollar advertising budgets. Affiliates or mom & pop businesses with small budgets have no place in their business model, when compared to Amazon, who spent $55.2 million alone.

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You forget one important thing. In markets with masse's, it's the long-tail who makes most of the money (like the 80/20 rule).
Same when you have a big website with a lot of traffic. Traffic come's from the long-tail searche's. These "piss" 40k exact match look then nothing against the whole.

..and same goes to Amazon, they don't make a lot of money because they sell a few things very much.
The money come's like from books only sold once, etc.

So, I guess this is really what G want's.
 
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That's it. Every new change in algo is a challenge to think about new strategies for staying afloat.

Take action and experiment. Everything changes in SEO, but one constant is somebody will always be #1 in the SERPs, the SEO's job is to be that somebody.
 
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