Amazon is looking to challenge Spotify by creating a music streaming service. The company is expected to start the service by early 2017. Amazon is expected to roll out its Echo-based streaming service in the coming few weeks while a full-fledged streaming service will likely be launched early in 2017.

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There have been reports in past couple of months, alluding to a potential streaming service by Amazon. The company already runs a video streaming service, which is tied to Amazon Prime.

Amazon's music streaming service is likely to be called Amazon Music Unlimited. Amazon is expected to charge $10 a month for unlimited access to its music library. Another service will be tied with Amazon's newly launched Echo system. This service is expected to be cheaper than the full-fledged service, at $5 a month. This service will let users have unlimited access to Amazon's music library. However, it will restrict the playback privileges to the smart assistant.

Amazon is said to be in talks with music labels, with sources claiming that negotiations are in the final stage.

The music streaming segment is mainly dominated by Spotify. There are other players such as Pandora, Google, and Apple, among others. Microsoft is also offering music streaming services to its users.

Spotify could further consolidate its position with its impending acquisition of SoundCloud. The deal will greatly enhance Spotify's repository of music as SoundCloud has more than 125 million songs in its collection.