Amazon.com had been reportedly developing a film streaming service, which would compete directly with Netflix, the Financial Times said.
Amazon will bundle access to the streaming service with Amazon Prime, a scheme that offers Amazon customers unlimited free shipping of books and other items sold by the online retailer after paying an initial fee, the FT said, citing a person familiar with Amazon's plans.
The company is already offering the Amazon Video on Demand service, which allows users to pay a few dollars to watch a movie or TV show once on a computer or on a TV equipped with an app for the service.
However, Netflix remains the leader in terms of services that charge a monthly fee to watch unlimited movies and TV shows on smart phones, tablets, computers and TVs. Netflix charges $7.99 a month for its service.