What's "everyone" doing? Delivering free, ad-supported, professionally produced video over the internet in a way that protects copyrights, pays people for their work, and serves up something akin to traditional TV advertising. In other words, network television on the Web—C.S.I. via WiFi. The content, delivered on demand, looks great—not like some pixelated YouTube clip, but as good as or better than cable television. When Joost started, nobody could do that. Today, a bucketful of companies, ranging from ABC and Microsoft to Blinkx and Brightcove, can—and a newcomer, Hulu, can do it really, really well.

Something else unexpected happened to Joost. Or rather, didn't happen. While more than 10 million people are swarming to YouTube's user-posted videos every day, consumers are not yet falling in love with high-end internet television. Only 10 percent of internet users watch full-length shows on the Web. Fewer than 6 million people have downloaded the software that allows Joost to run on a computer—which gives Volpi a total potential audience smaller than that of Animal Planet's Puppy Bowl IV.

Still, nearly everyone in television and the tech industry believes that internet TV will be a multibillion-dollar business. Market research firm iSupply says advertisers will spend $3.3 billion on it by 2010, and the major networks are placing their bets. CBS has its money on Joost. NBC and Fox have pledged money and content to back Hulu. ABC is attempting to turn ABC.com into a destination video site. Even former Disney C.E.O. Michael Eisner is on the bandwidth bandwagon, investing in Veoh. Network executives all know that internet TV will reshape their business, even if they don't yet know how—or how the sites will make a profit, since none are even close to doing that now.

Hoping to goose both Joost and the demand for internet TV, Volpi is making two major moves. This year, viewers will be able to watch Joost videos in a browser window. Go to Joost's website, click on shows like Seth Green's edgy Robot Chicken or an old Rocky and Bullwinkle episode and you can watch them as easily as you'd watch a video on YouTube. Previously, all Joost users had to download and install special software. "The download may seem like a small barrier," says Brad Hunstable, co-founder of user-generated video site Ustream, "but it's a huge mental barrier."

Volpi's other gambit is more daring. Beginning with the N.C.A.A. basketball tournament this spring, Joost plans to carry live programming. That's a technological nightmare, but Joost's software may make it the first company that can send live shows to millions of users. Imagine Florida retirees from Chicago watching Cubs games live over Joost. Or soccer-crazed kids in U.S. suburbs tuning in to European soccer matches.

"Live TV will be a milestone for us," Volpi says.

Here's how fast Joost went from superhero to life support.

June 2006: Word of the Venice Project leaks out. It gets immediate cred because Niklas Zennström and Janus Friis, the guys who started Skype and the music-stealing site Kazaa, are behind it. All anyone outside the project's inner circle knows is that it will offer internet TV. Given Zennström and Friis' disruptive track record, industry watchers predict the death of network television.

July 2006: The Venice Project gets its $45 million in funding. The mystery surrounding the company fuels blog chatter worldwide. It's a tech version of speculating about the finale of Lost.