That's an interesting thing to consider.

Unless they subsidize, New Glenn will have to be quite expensive. As the announcement says, they spent 3.5 billion just on a factory and a launchpad, and they are years away from launching.

Amazon, as such a high visibility public company, may have a hard time justifying a 2X+ price difference versus launching on Falcons, and for Starship the difference could be significantly more.

It's also questionable if Amazon is willing to wait 3 years to get any significant amount of sats into orbit. That will give Starlink a big advantage.

Of course SpaceX also has an incentive to delay Kuiper, so they might not bid for it at all, or only provide very limited availability.

That 2.5B is sunk costs. They should be pricing based on operating costs and the market, mostly ignoring sunk costs.

Sure, my point is that nothing about Blue Origin implies a lean, cost conscious way of operating or that New Glenn will be cheap to build and fly.

The money has to come from somewhere.

Either it's from Bezos, or it's from launches with a price that won't make it easy to win many customers in the very small market of large payloads.

I guess the optimistic take is that Bezos believes the addressable launch market will be huge enough to amortize multi-billion upfront costs. It's definitely a hail mary.

Will the end product be competitive if their launch costs are 2+ times the cost of their main competitor?

There are enough companies that won't launch on SpaceX because SpaceX is a competitor and enough companies that spread their launch contracts as a kind of insurance that a second vendor could stay viable. But with Blue Origin, ULA, Ariane and Roscosmos fighting for that second spot thats a small number of launches spread over quite a few vendors...