I think competition is a good thing and I'm not worried. But then I do not have a significant amount of currency invested in STEEM, just time, which of course is valuable. If Narrative succeeds in a UI that really caters to niche writing and groups I suspect it will do well since this kind of platform thrives on that format and it's something Steemit has failed to harness (in my opinion tags just aren't sufficient).
Also - Narrative is an awesome name, simply awesome. I'm a strong believer in good, strong names.