According to research conducted by corporate finance firm Avista Partners, investment in British IPTV businesses has declined by more than 90% since the launch of Canvas in September 2008.
Avista believes that Canvas, which counts the BBC, BT, TalkTalk, ITV, Channel 4, Channel 5 and Arqiva as its members, poses a "significant threat" to the development of the sector.
Earlier in the month, Canvas officially rebranded as YouView, with an aim to upgrade the Freeview and Freesat platforms to support video on-demand and internet services when it launches in the first half of 2011.
However, data compiled by Avista reveals that investment in the UK IPTV sector fell by 94% in the first 12 months after the Canvas launch in 2008 and 99% in the second 12 months.
In the year prior to the project's unveiling by the BBC, IPTV deals with a value of almost $35m (£22m) were being made in the UK sector. However, that figure has declined to just $2.5m in the two years since the launch
The period does cover a massive downturn in the global economy, but there has not been the same level of private investment decline seen in the US IPTV market.
Individual deals of more than $229m were being made in the US pre-September 2008 and the figure increased to more than $530m over the following two years.
"The UK has witnessed a dramatic fall in private investment for IPTV-based businesses since Project Canvas was first announced," said Paul Heydon, managing director of Avista Partners.
"It's difficult to lay the blame on the economic crisis for this, especially when directly comparing the extreme buoyancy of US investments in this sector for the same period."
Heydon added: "The UK has often led the world in exciting technological TV advances and there's certainly no lack of innovation or invention in this new market.
"Yet it's clear the collective power of the companies behind Project Canvas is a major cause for concern for investors looking at private IPTV businesses in the UK."
Last week, advertising trade body the ISBA joined a growing list of parties asking Ofcom to investigate YouView's impact on the UK market.