LU is not going to be competition for Blockland at all. Blockland is a free building sandbox game based on small servers; LU is an MMO. If they implement building at all, everything will have to be moderator-approved for both quality and age rating, and looking at the target audience it would seem a lot of everything wouldn't make it past part one. Even then, an MMO by nature will suffer from limited space resulting in overfull worlds on all the servers when the game hits a fully mature state.
That, and none of the other Lego * games have featured building, and while this is a letdown it's also a boon, as Lego has more than enough funding behind it to create a far better game in the genre than Roblox or Blockland. Whether or not they will or not is up to them, but until they do it leaves a niche for indie developers.
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