Following are opinions, not facts:
The Google TV box can be made for $50 if they use an ARM processor based platform, which is much lower power and much cheaper than Intel and provides all the same if not more 1080p and video streaming features.
The idea of implementing Google TV using the HDMI pass-through option (as “reported” by videonuze.com) and adding stuff to HDMI from the existing Cable/Satellite set-top-box sounds like a genius plan. If HDCP or however all those copy protection technologies of HDMI don’t prevent that solution from happening or to be turned off by broadcasters, then my guess is that Google could provide a $100 retail solution including HDMI pass-through and infrared emitter that would basically be compatible with all existing set-top-boxes, no matter what Comcast and DirecTV think about this.
HDMI pass-through and the infrared emitter would allow Google to replace your existing remote control with a more web centric remote control (and keyboard), display any overlay graphics and informations on any video contents, even “take over” existing programming, such as streaming customized advertisements instead of the broadcasted ads (with the agreement of the broadcaster of course). Possibilities could also include overlay chats, IMs and status updates, overlay community features like polls, discussions, ratings. It could include real-time user-generated recommendations for programming, even time-shifting to allow Google to overlay automatically generated subtitles, even translated subtitles. Time shifting could also allow for launching of related Youtube searches and videos at any time and then resume normal programming.
My guess though, even though Google TV will kill current broadcast monopolies and TV stations eventually, the Google TV solution will also completely revolutionize advertising for all TV stations. Basically, a TV station and broadcaster could opt-in to have Google manage personalized advertisment instead of the existing common denomiator type of TV advertisement. By doing that, the revenues from TV ads would go up 10 times overnight. So either they can decide to show 10x less ads for the same content, or they can make 10x more money and use some of it to create better contents.
In my opinion, the real deal here is to bring Youtube to the HDTV. But also to provide a recommendations box for broadcast TV as well. Imagine the Google TV learns what you like, because the Google TV remote control will have one big green “Like” button, users click it when they are watching something that they like. That will help Google learn your taste. And if you want to watch TV but you are too lazy to research what content is available, Google can generate recommended content queues for you, of either live or on-demand content, and a mix of both.
A cool little app that will change the TV and movie business seriously, because Google TV is open source, integrated BitTorrent downloads and RSS will not be stoppable. Which means, you want a movie, just type in the title and the device will start the BitTorrent download automatically, be it legal or not. And StreamTorrent type technology can even let you nearly instantly stream any contents using p2p technology. Net Neutrality will make this great.
I originally posted these estimates and opinions at: videonuze.com