Technically, it is not "free two-day shipping" at Amazon. First, you pay $100/yr to get it for most items if you are a Prime member. Otherwise, like many online retailers, you get free shipping (not sure if it's two-day) only if you reach a certain dollar threshold.

So, yes, "it costs too much" is the obvious answer, but it is true. Unless the recipient is in the same "zone" as the shipper, the cost of next-day air shipping is likely still anywhere between $20 and $50 (dependent on many factors), which is heavily discounted from retail rates. That would cut into margins quite a bit.

I get what you're saying, but here's my mindset. Walmart has a subscription service with free 2-day shipping (I get it's not free, but stay with me). They also have Jet which does the same thing. They aren't going to beat Amazon by playing the same game, so why don't they take the next step forward? It wasn't logistically possible when Amazon started doing it, but they figured it out.

And it wouldn't be logistically possible for most others starting out, either. Amazon has built out the capability over time, and I believe it now includes its own planes, trucks, warehouses and delivery staff.

I agree that promising and delivering on universal 1-day shipping may be one of the last ways to differentiate an online offering, but it either requires loosing a lot of money on individual sales or significant capital to build out the logistics/infrastructure yourself and hope the customers follow.

Amazon has free same day delivery on a huge selection of items in my area. They also have free One day shipping on almost everything here in San Diego once you order $35 worth of items

They will do same day shipping within a regional walmart / target. It'll probably end up an instacart like service.

Amazon do free 1 day shipping here in the UK.

Only in big cities?

Everywhere, with the exception of some small islands off the coast of Scotland that get their post by boat. Large cities get same day delivery (eg if I ordered something before midday I'd get it delivered by 10pm tonight) - https://www.amazon.co.uk/b?ie=UTF8&node=12615376031

Dang, why don't they do that everywhere then?

because cost and logistics?

you can'd just do 1 day shipping everywhere... there isn't a warehouse near every remote area

Lose money now, pass Amazon, and figure it out later?

jet.com tried that. They didn't crack Amazon, but they did build a startup that had a $3b exit.

Amazon has free same day shipping for many items with Prime in the US.

I see many items newly have an option of Prime Free One Day in US. But its for a selected inventory that have demand.

Only free if you pay for Prime. And it likely means it is in a nearby warehouse to you.

Right, so why doesn't anyone do universal 1-day shipping??

Amazon appears to be intent on attempting to do so, and may even make it pencil out. But it only makes sense if your logistics/warehouse network allows you to be within a day of all/most customers by a "ground" delivery method. Not too many retailers can offer that.

Probably the top 10 cities.

Zappos has had free one day shipping for years now.

A subsidiary of Amazon.