The BBC's governing body, the BBC Trust, has given permission for the BBC to participate in Project Canvas - an attempt to develop a standard for internet-television services in the UK.
What is Project Canvas?
Project Canvas is a partnership between the BBC, ITV, BT, Channel 4 and Talk Talk to develop a common interface for Internet Protocol Television (IPTV) in the UK.
On 9 July, Five said they were pulling out of the scheme.
IPTV allows you to access programmes via the net rather than through the air.
Canvas is an attempt to replicate the success of Freeview for internet television.
The partnership believes that developing a single standard will bring a new range of services in to the living room and kick-start demand for television over the internet.
It has been described as "Freeview Mark two" and an attempt to converge "broadcast with broadband" whilst the BBC's director general Mark Thompson described it as a "holy grail" for future public service broadcasting.
How will it work?
Viewers will be able to watch programmes and listen to digital radio channels through their television via a special set top box connected to an existing broadband internet connection.
It will allow people to watch so-called "Linear TV", (those channels currently offered via freeview and freesat) with High Definition options and the ability to pause, rewind and record.
The box will also allow people to access video-on-demand services, such as the BBC iPlayer, ITV Player, 4OD, as well as subscription channels.
In addition, the box will allow people to access internet services - such as YouTube, Facebook and Flickr - directly through their television.
The service will run in addition to existing on-demand services, such as the iPlayer and 4oD.
Haven't we heard this before?
The BBC was part of a similar project, codenamed "Kangaroo", initially expected to launch in 2008. Earlier this year it was blocked by the Competition Commission over fears that it may be "too powerful".
Kangaroo was designed to offer content from the commercial arm of the BBC - BBC Worldwide - along with programmes from Channel 4 and ITV.
Users would be able to purchase content from the broadcasters' back catalogue.
It was designed to do this though a single web portal, without the need for a set-top box.
The technology was bought by Arqiva in July and launched as SeeSaw in November.
How is Canvas different?
Canvas will be designed as an open platform, allowing other broadcasters to join and offer their content.
Web firms will also be able to build services for the interface. For example, Flickr could offer a tool to allow people to stream their photographs form the site directly to their Canvas-powered set-top box and television.
Manufacturers will be free to use the software to build their own set-top boxes.
Why have there been objections to Canvas?
Firms such as BSkyB and Virgin, which offer their own broadband internet services, have expressed concern that the platform may distort the market for IPTV.
Critics also maintain that the BBC should not be channelling licence fee funds into something which will also be used by other commercial channels.
Some TV and electronics manufacturers are concerned that they have not been included in the discussions about Canvas.
Some worry that the BBC and others will choose a standard for the UK which will be incompatible with standard chosen for the rest of the world.
Others have questioned whether broadband speeds in the UK are high enough to allow the service to achieve its full potential.
What happens now?
The Trust has imposed several conditions on the BBC's participation in the venture.
It says that the BBC must ensure that core technical specifications are published well in advance of the service's launch to allow manufacturers of set-top boxes to adapt to the standard.
The BBC must also offer other content providers access to the platform and make sure it is always possible to access it without a subscription.
The Canvas partners have already begun to develop the technical specification for devices, along with standards body the Digital TV Group.
They have also begun to build and test technology.
The trust has inisted that Project Canvas must publish its core technical specifications eight months before the first set-top boxes are launched.
In addition, the partners will continue recruiting other companies who want to participate in Canvas.
This will give broadcasters and manufacturers full opportunity to prepare for the launch.
It also means the project will not meet its proposed 2010 launch date. Industry figures say the service is now likely to begin in April 2011, possibly under the name YouView.