Ask HN: What to do when a 800 pound gorilla enters your business?
answers.onstartups.com
answers.onstartups.com
You need to focus on the backup part and do it for multiple platforms, not just Wordpress. Six Apart has a lot of enterprise users who pay big fees to the licence. Go to each platforms website and most of them list the clients they're most proud of (I.E. Obama's campaign website was based on Movable Type and they showcase it every chance they get).
Reach those people, corporate clients pay. Everyone has a need for a backup. your product is a no-brainer (luckily).
So to differentiate; a) expand to multiple platforms b) beat automattic in customer service.
Surprise your customers and they will spread the good will for you.