I'm being sarcastic but you're right. I live in a small town (in a small country) and there are a lot of unmet needs that software could address, and minimal technical competition. The other side of the coin is that the market is small, and capturing lots of geographically disparate niche markets is hard. Even nth runner up success in Home Automation for Rich People in Big Cities is a lot of money.
Innovating in small markets is fun and part of the reason why I'm here, but big markets are competitive for a reason. The adages about small startups being just as much work as big ones, and owning 1% of $10^9 being better than 10% of $10^6, still apply.