The supply of alternative, competing cryptocurrencies is unlimited. Very bad.
I think competition is good. There may be be an possibly unlimited number of cryptocurrencies but how many are actually going to be widely used? The incentive for people to flock to new currencies is small as long as Bitcoin is doing what people want it to do.
It's bad if there are no differences between them. Competition is good (although bad if you hold a lot of Bitcoins, perhaps). But the big draw is there are only 21M Bitcoins that will ever exist. If that number changed to 21B, that would be awful. Having a clone that could exist with the same features essentially doubles that number.
Sure maybe one would win out, and maybe both would live, but it's a threat.