What I don't get with Amazon is that they continue to spend whatever they make to capture market share but at what point will they start reaping what they sowed? What happens when there is suddenly no capital around to help this growth but competitors have plenty of cash in their vaults?
I'm not sure in what scenario that would happen. Amazon is funding its other growth with cash from its core business, which continues to expand. Your scenario would require that Amazon's core retail business die.
They positioned themselves very well in certain critical areas and I doubt that they will be easily replaced by competitors. For example in the ebook reader space most competitors already went our of business and Amazon is now close to being a monopoly in this space. At this point they should be set up pretty well to increase their margins. I don't know how much percent of each ebook sale they take but similar to Apple's App Store I'm sure this is a nice cash cow.
