Problem one- the hive effect- You cannot control over 500,000 drones with radar and not have one run into another. They will need to act like bees in a community, acting and working together as a whole. The most drones have been able to act together as is 32 drones in a 20 foot radius. more than that they start crashing and having problems.
Problem two- lawsuits- It will probably happen that one of the drones go haywire and crash into someone. That person will probably get hurt and end up in the hospital. Then they will sue Amazon for endangerment of the human race and they will have to stop using drones. Just a bad idea all over.
Problem three- production methods- Amazon would have to make there drones cheap in order to make a profit. They would have to be made in China and would need to be well made. You don't want the drones falling out of the sky due to radar failure or something of that sort.
Over all it is a good idea but they would need to address these problems before going into full production of the drones. They also need to make the drones smaller and lift more weight.