The statement wasn't: "no one ever vibe codes an alternative to product X"
It was: "With sufficiently advanced vibe coding the need for certain type of product just vanishes."
If a product has 100 thousand users and 1% of them vibe codes an alternative for themselves, the product / business doesn't vanish. They still have 99 thousand of users.
That was the rebuttal, even if not presented as persuasively and intelligently as I just did.
So no, it's not the case of "both things being true". It's a case of: he was wrong.
At some point there will be market consequences for that kind of behavior. So where market dynamics are not dominated by bullshit (politics, friendships forged on Little St James, state intervention, cartel behavior, etc.) if my company provides the same service as another, but I replaced all of the low quality software as a service products my competitor uses with low quality vibe coded products, my overhead cost will be lower and that will give me an advantage.