Work on a prototype service is already underway at Canoe Ventures Innovation Lab, a 'test bed' environment created by the cable collective, whose members include Bright House Networks, Cablevision Systems, Charter Communications, Comcast, Cox Communications, and Time Warner Cable.

The consortium has recruited Catalina Marketing, Delivery Agent, FourthWall Media, icueTV, and PayPal to address the use of RFI and T-commerce in interactive television.

PayPal X developer FourthWall Media demonstrated an innovative 'TV Buy Button' at the payment firm's Innovate conference last month. The button opens access to a consumer's cloud-hosted digital wallet that can be used to pay for goods and services seen on screen.

Osama Bedier, vice president of platform, mobile and new ventures at PayPal explains the concept: "Imagine this: lounging on your couch and channel surfing, then finding that perfect birthday present. A few clicks of your remote, and you've purchased the gift via your PayPal account."

He says that PayPal believes that the wallet "should live and will live" in the cloud.

"Internet-connected devices will be the very fabric of the digital lifestyle," he says. "And as televisions increasingly become Internet enabled, they open up whole new avenues for new ways to connect and sell to consumers directly."