1. AWS will take your initial and ongoing investment in the implementation but they don't have to share theirs with you. Specifically, they will take your improvements but their own improvements (say some performance optimizations) they can keep to themselves. It's good business sense if it allows them to further differentiate their "improved" offering from your "vanilla" service.
2. Competing on the the interface in this case really means competing on related services like management, etc. So your thesis is that you will provide a better/cheaper managed service than AWS. Even if that's true (a big if), most of the time the decision which service to use will have little to do with technical merit. I.e. we already use AWS, have SLA painfully negotiated, get volume discounts, etc. Do we really want to go through all of this with another vendor just for one extra service.
Just a couple of thoughts that will hopefully help you sharpen your thesis.