You can't compete against someone who is willing to cheat. You can't entice users to a better social network when their addiction to the old one has been engineered to near perfection. There's good reason that our present (and really truly good) alternative social networks haven't taken over Facebook's users. It's designed to be an addictive trap with no escape. You can't pull users away unless you're willing to be an even worse drug.
You have to force the other guy to stop cheating for competition to be possible.