This may be obvious to some but it has served me very well. When searching for a new niche, take some time to think outside the box. Think laterally. There are still niches out there in which you can be a "big fish in a little pond" and make good money. I'm talking about niches where very few, if any, internet marketers are working. I'm talking about niches where the things we take for granted (like squeeze pages, list building, and email marketing) work like absolute gangbusters.
I'll give you a real life example and that's insurance agent recruitment. To make a longer story short, about 3 or 4 years ago, I set up a few squeeze pages and started recruiting insurance agents. As far as I know, no one else was recruiting agents in this manner. It still works great to this day. Actually, it's gotten even better as I continue building my lists. I make a full-time living just from this niche.
I'm willing to bet if you were creative enough, you can find other profitable niches out there that are not saturated with other internet marketers.