> Their basic underlying assumption appears to be that they're no longer in danger of losing customers and can now act accordingly.

That's the assumption of google/youtube, facebook, microsoft, etc. Once you reach a dominant position, you don't have to care as much. You even see this with netflix.

> A random example... the cat litter I just purchased is $17.89 at Amazon, $13.49 at Walmart. Last week I bought a chair mat for $21.95 on Ebay - identical item on Amazon was $33.95 (both including free shipping but Amazon came with an additional 8.25% sales tax).

Bingo. Amazon used to be where the best prices were. Now so much of their products are more expensive than what you'd find in your local supermarket. And they are significantly more expensive.