That's just a rumor, and from a strange source at that. Nonetheless we have an http://www.gamesas.com/topic/1358980-official-tes-multiplayerco-op-thread/ for all multiplayer discussion relating to the Elder Scrolls series. Please read over the opening post before jumping in as it contains important ground rules. I'd also suggest doing a search before posting a new thread: quite a number of threads on this topic have been made, and locked, in the past few days.
A second post worth noting, http://www.gamesas.com/topic/1358852-tes-mmo-leak/. They do have a sister-studio, Zenimax Online Studios, that specializes in MMO developement - so if an Elder Scrolls MMORPG is in the works it is presumably being developed by ZOS. It's also possible that ZOS's current project has nothing to do with the Elder Scrolls.
Supposedly set in the second era, long before any of the TES games.
Long before the core series, but TESA: Redguard takes place in the second era (although near the end of it).