I rarely do this -- but, if this report is true, then this time I am stepping back and smiling -- I predicted this. I wrote about the coming new "iTV" back in early June -- here is my post.
What will "iTV" be? In the short-term, it will likely be simply a more developed iteration of its current set-top box "hobby."
But, expect that to change. iTV ultimately will be much more -- I have little doubt that Apple will try to transform the "all-in-one" consumer experience again -- this time in the living room with a seamless flat-screen hardware/software experience where no set-top box will be required.
Ultimately, that is the holy grail. And, Apple does not aim low. It's holy grails or bust for Jobs. And, Apple usually scores when it is on a mission. And, the living room is the next great frontier.
I hope to say "I told you so" once again in the future -- but, not boastfully, just because of the inevitability that I see.