You know, I've heard this claim before (that the strategy behind VS Code is to make deploying code to Azure easy), but it never made much sense to me. Deploying a service to production straight from an IDE/editor sounds like a recipe for disaster. I say this as a daily user of Visual Studio, VS Code, and Azure.
Making it easy to setup a demo project means things may stay on Asure because that's the fastest path to production.
Thus it's about business migrating from Demo (Asure) > Production (Asure) vs Production AWS > Azure.