EDIT: OK, you're talking about customer experience and maybe that's a long term risk, but as long as that graph continues it's trend not many people at the top of Amazon are going to share our frustration as customers. There are plenty of customers out there throwing money at them.
> AWS’ revenue makes up 14.5% of Amazon’s total revenue of $110.8 billion. And for the first time ever, revenue from AWS, advertising, third-party seller services and Prime subscriptions ($55.9 million) surpassed revenue from Amazon’s retail and product sales ($54.9 billion).
This certainly reinforces your point! It sure sounds like Amazon retail is a sort of loss leader.
[0]: https://www.fiercetelecom.com/platforms/aws-to-rescue-3q-rev...
"Your margin is my opportunity" --Jeff Bezos
Jeff's ethos seems to be undercut everybody at any chance. That seems to include people using his platform in the form of plainly labeled Amazon branded products or Amazon owned brands of other names. Open a platform to sell things. Open that platform to allow 3rd parties to sell things while taking a cut. Aggregate all of that sales data to find what items are worthy of selling those items directly screwing the 3rd parties.