Arguably, this problem happened to Java web frameworks.
Too few and you lack innovation and fresh ideas, and things get driven to ideological extremes that aren't healthy or suitable for everyone (I don't want to start a flame war, but I feel a bit that way about Rails).
Too many and none of them get enough community or support to reach critical mass. What this meant for Java is that most people ended up being forced to use J2EE frameworks designed by committee which were awful, and drove a lot of people away from Java altogether.
Actually what I've seen with Java is that the committee-designed J2EE frameworks failed to keep up and got left behind. In the last five years, the only times I've heard of teams using EJB or JSF were either moving away from them or embarrassed by them.
Too few and you lack innovation and fresh ideas, and things get driven to ideological extremes that aren't healthy or suitable for everyone (I don't want to start a flame war, but I feel a bit that way about Rails).
Too many and none of them get enough community or support to reach critical mass. What this meant for Java is that most people ended up being forced to use J2EE frameworks designed by committee which were awful, and drove a lot of people away from Java altogether.