Like much of the internet, having the “cloud” does not eliminate the ground based assets. SpaceX had to and is still building out ground physical data center infrastructure that the satellites connect to.
AWS has a huge physical infrastructure in place on the ground, around the globe.
IIRC, amazon isn’t going after the consumer segment, but focusing on the business sector - Higher bandwidth per customer, less dishes, less customers to support, more revenue per customer.
Amazon has their work cut out to catch up, but if executed well, they can claim a niche which will provide the needed revenue to continue expansion.
SpaceX is going about this in a more challenging way, but Elon likes a challenge.