Mark Consuelos, left, John Goodman, Matt Malloy and Clark Johnson of Amazon's original series 'Alpha House.' Alpha House, which was written by Academy Award nominee and Pulitzer-Prize winner Garry Trudeau and produced by Trudeau, Elliot Webb and Jonathan Alter, is a comedy about thesefour misfit senators who rent a house together in Washington, DC. The series is available exclusively on Prime Instant Video. (Photo: Amazon Studios) 
 
 UPDATE: Amazon denied Thursday reports that it is considering a free streaming media service. 
 
 "We have a video advertising business that currently offers programs like First Episodes free and ads associated with movie and game trailers," said Sally Fouts, Amazon's public relations manager. "We're often experimenting with new things, but we have no plans to offer a free streaming media service." 
 
 The denial follows a story byThe Wall Street JournalThursday that the Seattle-based online retail giant may be adding a new streaming service to its portfolio. The company currently includes streaming movies and TV episodes as part of the Amazon Instant Video features for subscribers to its Prime service. But the story said the planned free ad-supported service could let non-Prime members watch licensed programs and Amazon original video series such as Alpha House. Music videos could also be part of the ad-supported service, the report said. 
 
 The WSJ report comes as Amazon prepares to host a press event in New York City next Wednesday for "an update on our video business." Amazon's long-rumored set-top box could be part of the event, which is being hosted by Amazon vice president Peter Larsen. There's no word on whether CEO Jeff Bezos will be in attendance. 
 
 Alpha House was one of several original series green-lighted by Amazon Studios last year, to keep pace in the race to create original programming as is competitor Netflix, which has series such as House of Cards and Orange is the New Black in its corner. Amazon recently hiked the price of its Amazon Prime service, which includes streaming content with two-day delivery of merchandise ordered on Amazon.com, to $99 annually from $79. 
 
 Amazon might be considering a free streaming feature in its new device, says Phil Swann of TVPredictions.com. But it must tread carefully because if it cheapens the video features of Amazon Prime "it would risk losing Prime customers. After all, it just raised the price." 
 
 Read or Share this story: http://usat.ly/1jTheaP ||||| Actor Ed Begley Jr., above in a scene from 'Betas,' an online show offered to Prime subscribers last year. Amazon/Associated Press 
 
 Amazon.com Inc. is considering an advertising-supported streaming television and music-video service, a departure from its strategy of linking video to its $99-a-year Prime subscription service, according to people close to the company. 
 
 Amazon is considering an advertising-supported streaming television and music-video service, a departure from its strategy of linking video to its $99-a-year Prime subscription service. Shalini Ramachandran has details on MoneyBeat. Photo: Getty Images. 
 
 The proposed service, as Amazon has outlined it to potential partners, could launch in the coming months and could feature original and licensed content, these people said. As part of the service's development, Amazon has held talks with the creators of "Betas," a series about a Silicon Valley startup that Amazon co-produced last year, these people said. 
 
 Amazon also plans to offer free music videos with advertising to people visiting its retail website, two of the people said. A search for Bruce Springsteen CDs, for example, might yield an option to watch the "Born in the U.S.A." video. 
 
 An Amazon spokeswoman said, "We're often experimenting with new things, but we have no plans to offer a free streaming media service." 
 
 Ad-supported video would be part of a broader move by Seattle-based Amazon to transform itself from a retailer into a force in multimedia. The company dominates e-commerce, but rivals like Google Inc. 's YouTube and Netflix Inc. have leapt ahead in streaming music and video. TV advertising is expected to generate $68.5 billion in the U.S. this year, estimates industry researcher eMarketer. 
 
 Amazon last year invested about $1 billion to acquire content and produce original programming, according to Cantor Fitzgerald. Such spending, along with efforts such as expanding grocery delivery, have left Amazon with scant profit despite rapid revenue gains. 
 
 Ad-supported streaming video would give Amazon an opportunity to flex its advertising muscle. Amazon has been quietly building out a service for placing ads on its own and other websites. eMarketer estimates the ad-placing unit will hit nearly $1 billion in sales this year, rivaling AOL Inc. and IAC/InterActiveCorp but smaller than Google's or Yahoo Inc.'s operations. 
 
 By comparison, YouTube—which streams a combination of music, television, film and original content such as home videos—generated about $5.6 billion in revenue last year through advertising, estimates eMarketer. 
 
 Data Amazon collects about viewers' television and music preferences could allow it to deliver more targeted ads, including for products sold on its retail website. It could sell Adidas shoes to Run-D.M.C.'s "My Adidas" music video fans. 
 
 It isn't clear how Amazon would deliver the ad-supported content to users, though it could create a special section on its namesake website, the people said. These people cautioned Amazon could indefinitely delay the project or alter it because of financial or other concerns. 
 
 While choosing which shows to produce for its Prime video service, Amazon in February showed free pilots of 10 series on its website and ran ads for Berkshire Hathaway Inc. 's Geico insurance before some. 
 
 Amazon chose "Betas" for a first season on the Prime service but is unlikely to renew the series for a second season, people familiar with the matter said. Amazon has discussed producing the show for the ad-supported streaming project, those people said. The co-creators of "Betas" weren't available to comment. 
 
 Video for the Prime service is delivered through specially equipped televisions, set-top boxes like those made by Roku Inc., PCs, videogame consoles such as Microsoft Corp.'s Xbox, and Amazon's Kindle Fire tablet. 
 
 That is about to change. Amazon on Thursday invited media to an event in New York next week where it is expected to release a streaming-video device, to better compete with Roku, Google's Chromecast and Apple Inc. 's Apple TV. That service will feature apps found on other set-top boxes like Netflix and Hulu, according to people familiar with the matter. 
 
 The proposed ad-supported service and Amazon's streaming device may be an effort to entice customers to upgrade to Prime, which offers unlimited streaming video and two-day package delivery service, the people close to the company said. 
 
 Prime subscribers spend twice as much on Amazon.com than do non-Prime customers, according to some estimates. 
 
 Amazon hopes the ad-supported music and video services prompts users to buy more merchandise from Amazon.com, those people said. The additional data on viewing preferences also may help it better tailor product recommendations to its roughly 240 million users. 
 
 —Shalini Ramachandran contributed to this article. 
 
 Write to Greg Bensinger at greg.bensinger@wsj.com 
 
 Corrections & Amplifications 
 
 This article has been updated to reflect that Amazon has now denied that it is planning the service as described. Prior to publication, the company did not respond to requests for comment. The update also clarifies that the article is based on Amazon's outline of an advertising-supported service in talks with potential partners. ||||| Looks like we will finally get to see the long-rumored and at-least-once-delayed Roku competitor from Amazon (S AMZN) next week. The company just sent out invites to a media event in New York next Wednesday that promises “an update on our video business.” 
 
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 The invitation doesn’t mention any hardware announcement, but at this point, it’s pretty clear that Amazon will announce the device next week. The company has been working on a TV streaming device since 2012, and originally intended to launch it in time for the 2013 holiday season, but decided to delay the product launch for unknown reasons. 
 
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 Here’s what we know so far about Amazon’s TV streamer: The device will be powered by what the company internally calls the Amazon Common OS, which is a forked version of Android that also powers the company’s Kindle Fire tablet. The device will feature Amazon’s Prime Instant video service front and center, but also offer third-party apps, including Netfix and Hulu Plus. And there may be a gaming component to it, since Amazon has been developing a wireless game controller.
– YouTube and Netflix, watch your back: Amazon plans to stream video content for free and rise among the ranks of multimedia power players, sources tell the Wall Street Journal. If it happens, the project will include original series like Betas as well as licensed programming that Amazon could tie to its retail website (shoppers looking for Bruce Springsteen CDs might watch the video for "Born in the USA," say). The service would run on ad dollars and try to entice people into paying $99 annually for Prime, which currently offers unlimited video streaming. Other evidence something's up: Amazon paid about $1 billion last year for content and original programming, and plans to launch something new next week—likely the Roku-like box it's been building since 2012, GigaOm reports. The device will offer Prime video along with apps like Netflix and Hulu Plus, and possibly games (Amazon has been designing a wireless game controller, after all). The box may even include free streaming, but if that reduces the value of Prime, Amazon "would risk losing Prime customers," a TV analyst tells USA Today. "After all, it just raised the price."