If you used a cell phone near y2k, you probably paid for every SMS you sent and received. Providers competed on price or sold you prepaid bundles. They outbid one another for your business by offering to pay less for your SMS. Minutes were also priced, and your available call time was an important aspect of which plan you would choose for your cell phone. Data, though, might have been free and unmetered. It was the secondary dimension of your subscription. It's not much of a surprise, then, that Whatsapp would eventually catch on. Messaging over data? It takes a lot of text to make up the cost of one SMS, if your data costs anything at all.
Skype was fresh out of a ten year spread across the entire world doing the same thing for calling if you had a computer. Meanwhile, telecom giants' business was huge and immovable, so the best they could do against free messaging was lower price metered messaging. Not convincing enough? How about lowered, lower priced metered messaging, but only for the first year and with lots of disclaimer footnotes? You sure?
Prior to that, Valve was similarly eating up the gaming market with Steam. While every publisher was focused on preventing piracy by treating everyone like a potential criminal, Steam just picked piracy's preferred distribution mode – online and instantaneous – and used it to give users their own persistent libraries they could install from on any new machine, provided they could log in (making Steam itself DRM, but customers didn't even have to notice it). Publishers were a mess during the same time, because what they eventually offered was an insincere halfway point – physical boxes in big stores, containing a single DVD with a 300mb installer that would download a 60gb game and use up a one-time code in the process, leaving you with none of the advantages of the physical copy (they even did away with booklets and manuals!), and nothing gained from the downloading either. They did not compete because they could not give up a business model they had structured themselves around.
Netflix, arriving just ahead of cable television's unbundling apocalypse, again did the same. Cable television didn't really want to compete with fixed-price monthly access to a complete library. They wanted everything interesting to be an expensive add-on you need to pick separately. Their answer to "everything for one price", again, was "complicated bundle choices but at a lower price". A few years later, to your absolute surprise I'm sure, a great migration started.
I'm sure you see the pattern. In all of these cases, giants have structured themselves around a group of preconceptions of how a given business needs to run – video media is a list of subscription options that unlock live channels, cell phones are metered devices, game distribution is first a copy protection mechanism, etc. To be clear, the incumbents usually adapt over time. They tend to have the capital and patience to get pummelled by new market behaviours before they are forced to change.
In the context of a crystallized market, the true advantage challengers arrive with is the absence of artificial gates or scarcity, that once put in place, are too profitable to take away, even once time passes and you find the whole market running away from you.