Some 6,000 individuals have already been testing the service, named the Venice Project, the newspaper said.
Janus Friis and Niklas Zennstrom invested part of the money they made fromin developing the new product, it said.
Friis told the Financial Times that peer-to-peer technology used by the service, would make it possible to serve "tens of millions of users" while overcoming content owners' security fears.
"The overall picture is that this is happening., and people have to find strategies for that," he said in an interview.
The service was able to display high-quality, full-screen video on a computer screen, according to the Financial Times.
Friis outlined his plans for the service to a Danish newspaper in October, predicting at the time that it would be out in the next few months. He said it would bring quality TV programs for free to consumers who have a broadband Internet connection.