1. Opportunity is found and exploited.2. Profits decline due to competition or other factors. High end "how to" courses are developed and sold with the representation of profits at level 1.
3. Profits from 2 begin to decline due to competition. Cheaper and cheaper "how to" are available ending with cheap ebooks on eBay (before they were banned).
4. Occasionally the niche is such that a course is developed to teach others how to make money by teaching others how to make money by teaching others in the niche.
Examples: Adwords, General IM, Affiliate marketing. It works this way for non-internet stuff too i.e. Real Estate.
Having said that, people are still (pre-crash) making money in Real Estate, for example, even with tons more people chasing deals as a result of the hype. A few are able to see past the hype and persist to make decent profits and have learned the basics from the how to material, while realizing that they don't need to keep buying more of the same re-hashed courses hoping for some new magic technique.