Because I believe Amazon is losing money on each ebook sold. They want people to move to their platform so badly that they're willing to accept a loss on each ebook and make it up with the hardware costs.
That makes no sense - the more books they sell, the more money they lose. No business should sell below their marginal cost for any length of time unless they're really desperate for market share. What's more common is selling the hardware at a loss, and reaping the profits on the e-books.
