(via Digg)...New Scientist reports:

"The BBC is poised to release a free and 'open source' internet video delivery system to compete head on with proprietary favourites.

The UK corporation has developed its own video compression algorithm, called Dirac, which will provide an alternative to the video file formats used by Microsoft's Windows Media Player, Apple's Quicktime and RealPlayer from Real."

cosmicvibes.net:

"I read about this a long time ago, but now it’s getting close to release I thought it worth mentioning. For those who haven’t read the above link, basically, the BBC are going to release a free video codec with which to stream their shows online for you to watch. It’s like RealPlayer, Quicktime & Windows Media but free and open source. "

Wikipedia has a Dirac entry here.

"The codec is named in honour of the British scientist Paul Dirac."

From the Sourceforge Dirac FAQ:

Who are you guys?

The BBC Dirac team is led by Tim Borer, Principal R&D Engineer in the BBC Research and Development Department. The main algorithm developer is Thomas Davies, Senior R&D Engineer, who devised the Dirac algorithm. The software is managed by Anu Suraparaju, Senior R&D Engineer, and Andrew Kennedy, Software Engineer. Michael Prior-Jones is a Graduate Engineer who's attached to the team until October 2005. 

How did Dirac begin?

BBC R&D has always been involved in video coding research as it's central to what the BBC does. Thomas began experimenting with compression techniques in about 2001, and developed various prototypes of coding tools. In January 2003 he had a rough research system in place which seemed to perform well. Since then he's been working to translate the software into something that could be the basis of a working codec, and to streamline the design. This involved rewriting the codec entirely in C++ to exploit the flexibility and modularity of the language.

Plugincinema Interview with Thomas Davies, Senior R&D Engineer at the BBC,

PC: In your opinion, does working at a publicly funded organization have a different approach in terms of both the development and the licensing. How is it different to that of a commercial corporation?

TD:That's a hard question! I think the BBC has always had a very strong commitment to Open Standards, which have actually benefited the whole broadcast industry as well as other PSBs. But I don't think such a commitment is necessarily confined to publicly-funded organisations. There are many manufacturers and technology companies that share it. I think it's more a question of degree - the BBC is particularly concerned about public access and in the development of TV to date that's implied Open Standards.

As for licensing, BBC R&D does do commercial licensing. There's always an argument about whether the public is best served by our licensing things and selling them, thus bringing more money in to make programmes with; or giving things away, and allowing the public to participate at lower cost. Essentially we consider each project on a case by case basis.