It's terrible for Valve, Amazon is consuming a major portion of the revenue they got to have to themselves before. Those deep discounts were partially based on the concept of Valve getting the whole, fat pile of revenue off their storefront. Steam is useful as a platform because of all the free services, it storefront revenue pays for Steamworks. The shit deals you're seeing on Steam the last few sales probably has a lot to do with other storefronts cannibalizing so much of their revenue.
That's short term implications in my opinion, not necessarily long term. As has been mentioned, it does help build people with Steam libraries, and we've all seen how loyal people with large Steam Libraries get.
That's ignoring the fact that even without Amazon, Steam wasn't the best place to get Steamworks games anymore if all you look at is price. Due to it's very nature, Steamworks games have been sold for less on other retailers, due to the simple fact that, if they don't, there's no reason to get them anywhere else but Steam. As a result, Steam does it's best to provide 'incentives' for people buying it on Steam, usually an exclusive Preorder bonus or something.
I've been wondering for a long time already how realistic it is to have Steamworks be a long time thing though. Because of the above, the more games there are that are Steamworks, the more they get undercut by other sellers. But as mentioned, they're trying to work with that. And the loyalty pretty much guarantees them some sales from people too lazy to look elsewhere, and guarantees them a lot of sales from games that are *not* Steamworks, but people want them in their list, so Steam is the only place to buy those. For that reason, I have to wonder whether the best middleground for Steamworks rather isn't for every game, but more something like half of them (or less).