The altitudes are logically broken down into 200ft (max height under a blanket COA), 400ft (max height under a “333 exemption”), and 500ft (generally, the floor of navigable airspace as defined in 14 C.F.R. 91.119(c)).
The 400-500 feet buffer zone provides a nice cushion in case there is a simultaneous altimeter error of a manned aircraft, a GPS error on a drone, or just a private pilot fiddling with or trying to find something in the cockpit.
The Federal Aviation Administration (FAA) issued a Notice of Proposed Rulemaking (NPRM) greatly detailing drone operations below 500 feet, but the NPRM and Amazon’s plans don’t exactly line up. The FAA will have to amend its proposed rules to match up with Amazon’s.
For example, the FAA’s proposed rules allow for drone flights up to 500 feet. The FAA would have to change the proposed rules down to 400 feet. Furthermore, the FAA’s proposed rules allow many small drones to fly in the 200-400 feet area, while Amazon’s plan would limit it to “well equipped vehicles as determined by the relevant performance standards and rules.”