Can they? They aren't the ones selling those products, individual companies set their own prices - and they have to pay a cut to Amazon. Even if that cut goes to 0 (making Amazon lose lots of money), that only puts them at barely better than the rest of the market. Walmart sets its own prices.
>2) Given purchasing power scale and people like fast delivery there will only be a handful of companies that can complete with Amazon ever, so it seems unlikely there will be a 'started in the garage' business compete with them now the market is maturing.
I think this has been proven wrong time and again. There's always a way into the market.
>3) With the extra profit Amazon are making vs a competitors they can develop and buy technologies or business to keep a moat around them for a long time.
Just the same way every other company has maintained an iron grip on every market it's in...?
History repeats itself, companies rise and fall, and they gain and lose market share even when they have an endless supply of money.
The most important part of running a business like Amazon is consumer trust - and Amazon is playing a losing game right now.