Technology

It can't be allowed to fly too close to people, and there's also concerns with interfere, collisions, animals, etc

Probably loss of signal from GPS for one, and there are far more obstacles like power lines that can be hit below 12 feet.

Having built commerical drones, it's mainly two things, obstacles and ground effect.

I mean, the most obvious sinister application for this tech I can think of would be military dones that precisely drop small bombs on targets, but based on the ongoing war in Ukraine, that technology already has been developed, so Amazon of all companies developing it again would be pointless.

EDIT: come to think of it though, while the technology for that military application already exists, having a delivery drone industry might be a benefit to a country in wartime anyway, because the factories to build those drones could be repurposed to make military drones, and the drone fleet itself could be requisitioned, sort of like how navies have often throughout history pressed civilian ships into service in various roles, and with probably minimal modifications be used to gain a sizable fleet of bombing drones very quickly without having to have the military maintain that fleet idle in peacetime. Not sure this actually benefits the company much though, just the country that has a sizable network of these drones and/or factories to build them within it's control.

I suspect that would be your responsibility to either clear the area or not use the service. I can see the service having some useful niche case uses. Mainly if you need something light on short notice.