Apple is expected to design a connected television over the next two years, launching in 2011, with built in DVR functionality. This is what Gene Muster wrote in his lengthy report. This means that recorded shows could then be synced with Macs, iPhones and iPods over a wireless network. Such a device would cement the company's footprint in the digital living room offering a variety like interactive TV, music, movies and gaming features like an all-in-one package. Apple would also be capable of bringing its own television minus the set-top box or devices. With just the help of a CableCARD, Apple could effectively replace an entire Home Entertainment system including the music stereo, cable box, Blu-ray/DVD player and the gaming console with and all-in-one APPLE TV.

Apple would be more open in exploring such a market if its gaming technology was simply a supplementary feature to home entertainment hub.

Source: [Apple Insider]