I think this list demonstrates the OP's point—entrenched, resource-heavy, and reputable firms have and will continue to capture most of the markets, not for lack of competition, but by ownership over the distribution channels.

Having said that, I don't think it's all AI (this trend's been going on for a while), nor do I think startups can't thrive—as the pie gets bigger, competitors can carve out yet smaller niches, as the OP points out.