Americans watch in average 5 hours of TV every day. Imagine a revolutionary $99 set-top-box which you add to your living room. This one increasingly brings more and more content from the Internet to the HDTV. This one even improves the experience of regular TV channels by overlaying search features and better targeted ads (which can finance better TV content).

Engadget is reporting on the rumored $99 Apple iTV set-top-box. It will basically be like an iPod Touch, without the screen and with an HDMI output and a remote control. It’ll have the latest Apple A4 processor which is based on the Hummingbird 45nm ARM Cortex A8 processor (similar to the one used by Samsung in the Galaxy S) designed by Intrinsity before they were bought by Apple. As usual, I don’t expect Apple to include support for many video and audio codecs and a proprietary iTunes synchronization over the network is more likely than support for the Samba and Upnp local file sharing standards.

The idea here is that by using the optimal ARM processor of the market, a very powerful yet very cheap set-top-box can be made. One that brings full 720p web browsing to the HDTV, but also re-designed and optimized graphics accelerated user interfaces to the HDTV, basically smooth interfaces for Youtube and other video-on-demand sources, to thus be watched directly on the HDTV.

I’ve video-blogged about Android based set-top-boxes such as the $50 design by Webia Technologies and Bonux and the $129 (retail target price) one made by Keenhigh mediatech. Both can run the latest Android 2.2 software (when available) with full 3D graphics acceleration even though their processors are likely ARM9 or ARM11 based.

As Google goes along partnering with Intel to release Google TV soon, I expect the Intel based designs to be sold at $199 or likely above that. I think it would be nice to know how soon the customized Android software that represents the Google TV disribution would also be optimized for use on cheaper ARM Powered solutions. As Android on those cheap prototypes looks great, it would be good for those devices to know they can rely on a Google OS optimized for use with a remote control and optimized for easy access to revolutionary HDTV features. Including the support of Youtube in HD quality on all those cheap boxes.

The basic hardware features needed for full Google TV support on cheap ARM Powered set-top-boxes I think are HDMI input and output (pass-through) for overlaying features to contents from existing Cable/satellite set-top-boxes as well as the IR blaster to control that other set-top-box. But for Internet and media streamer features only, all that is needed is just a Google TV for ARM software release.