Culture secretary Tessa Jowell will give her decision on Thursday at the Royal Television Society's convention in Cambridge. She is expected to announce that the corporation will be allowed to launch BBC3, for the under-35 market, and BBC4, an arts and culture channel.
Jowell, however, is only expected to give the green light to one of the two children's channels the corporation had hoped to launch.
The commercial sector, including operators such as Nickelodeon and BSkyB, has argued that the children's digital TV sector is already overcrowded. Culture channel Artsworld is also said to have complained about the prospect of a rival publicly funded arts and culture channel such as BBC4.
Meanwhile, in the race for the BBC chairman's post, the favourite and current BBC deputy chairman Gavyn Davies has pledged that he would insist his deputy is a member of the Conservative Party, if he takes the top job.
Davies, chief economist at Goldman Sachs, is married to chancellor Gordon Brown's assistant Sue Nye. He has also donated around £10,000 to the Labour Party.
His appointment as chairman of the broadcaster would cause objections because the BBC's director general Greg Dyke is a former Labour Party donor and the BBC's commitment to unbiased reporting would be seen as being compromised.
Davies is to be interviewed this week for the post. He is expected to argue that overlooking him for the post because he is tied to the Labour Party through marriage is old fashioned. He will also promise to make decisions based on broadcasting and business terms alone.
If Davies is successful, one of the frontrunners to become his deputy could be Sarah Hogg, who was head of John Major's policy unit between 1992 and 1995.
If you have an opinion on this or any other issue raised on Brand Republic, join the debate in the Forum here.