Five has pulled out of Project Canvas, the cross-industry scheme to develop an internet-based TV service involving the BBC, ITV, C4, BT, Arqiva and TalkTalk.
A statement from the channel, for which parent company RTL is looking for a buyer, says it’s currently reviewing its digital strategy and does not see Canvas as one of its key priorities.
Five’s withdrawal will leave an investment shortfall of a not inconsiderable £116m, a bill which is expected to be picked up by the remaining partners.
The troubled channel was forced to pull out of the launch of its planned HD TV service on Freeview because it failed to provide media regulator Ofcom with a launch date or programming schedule in time. Five HD has however since launched on both Sky and Virgin.
The news follows the BBC Trust’s approval of the project last month. When it’s eventually launched, the service will offer on-demand services such as the BBC iPlayer and ITV Player via a new range of set-top boxes.