Found this buried in a discussion on Facebook from JMS himself:
Re: B5…the studio offered a full season of a new and rebooted B5 as part of a new distribution venue they were creating (us and several other shows from the same studio were part of the same deal). We’d have a full season, a big budget, and total creative control. The negotiations (not between us but between the participants of the venue) dragged on for over a year, we were told repeatedly this is going to happen, but finally, the participants couldn’t make the math work. So we and the other three shows that they were hoping to put out there got set aside.
At this point, I’ve told the studio that if this isn’t going to move ahead, there’s something else they need to consider and there’s a very informal negotiation going on now in that regard. We’ll see where it goes from there.
But again, B5 was never created to be a Deep Space Franchise, we wanted to do our 5 years and get out clean. That was my intent going into this, and if that’s where this ends up, I’m happy to stick with that. There are other film and TV projects I’m doing, including a deal we just concluded to write a pilot for Will Smith’s company on a show that’s been pretty much pre-sold for a full season overseas (two bidders want it badly for Europe, and now they’re just looking for a US partner).
So it sounds like we were VERY close to a “new and rebooted B5” (not sure what that meant exactly) via a new distribution venue (also not sure…web-based? iTunes?), but it isn’t happening – but something else could still happen.