Yawn
As far as I can tell, this is just EC2 with features removed to enable a simpler pricing model. The fact that many of these features become available again through VPC peering suggests that it's a separate (someone else's?) data center. But the price isn't really going to destroy Digital Ocean etc. Looking at the 2GB level, which is the lowest they all have in common and is what really constitutes a starter system:
* Digital Ocean - $20/month for two cores and 40GB SSD
* Linode - $20/month for one core and 24GB SSD
* Vultr - $20/month for two cores and 45GB SSD
* Lightsail - $20/month for one core and 40GB SSD
Lightsail is below median for cores, at median for storage, all for exactly the same price. Without benchmarks - especially storage benchmarks which IMX have shown a 2-3x difference between providers or even instances within one provider - it's hard to know which is really the better deal. The real take-away here seems to be that Amazon was feeling pressure at the low end.