Being totally awash in karaoke companies isn't the problem. The problem is that people are settling for these low rates. If everybody held out for more they would get more. We all need to band together and work to bring the rates back up.
Not too long ago I had a 2 night a week gig I took from one of those 100 dollar a night people. Since it was 2 nights a week I gave the guy a break at 150 a night for 4 hours. Not two weeks later he wanted to lower my fee to 100 a night and I walked. Boy was he surprised! He called me back a couple weeks later. Too bad for him because I had already filled both those nights at 200 a pop. If I go about 40 minutes west of here I can get as much as 275 for a 5 hour show on a weekend. And this in the Chicago Suburbs. And if you think it isn't saturated out here, think again. We even have a local magazine dedicated to karaoke! See
http://www.karaokenitelife.org If you offer a premium service, they will pay for it. Just make sure you have a way to differentiate yourself from the others and you will get it.