Azure and Google are good enough in the eyes of a lot of people to compete, and Amazon believes this to be true, otherwise they wouldn't match price cuts the ot

Azure and Google are good enough in the eyes of a lot of people to compete, and Amazon believes this to be true, otherwise they wouldn't match price cuts the other two make. They have. The problem for Amazon is that Microsoft and Google don't need to profit on Azure and Google Compute the way Amazon does. Microsoft can sell Azure services at low margin and make the rest of their money selling Visual Studio and MSDN subscriptions and whatever else to developers working on sites hosted on Azure, and selling Office 365 and whatnot to companies shifting their in-house resources towards the cloud. Microsoft sells a lot of complements that mean it can get away with selling services on Azure at close to cost and still make money. Google's in a similar position, in that it has other complements (AdWords, services like Maps, Android, etc.) for developers working on its stack, and it has enterprise products like Google Docs as well. Amazon meanwhile is selling AWS products but no strong complements. So being dragged into a pricewar with Google and Azure means a very real chance that they continue to not make a lot of profit on AWS, even if they beat Microsoft and Google.