I hate to admit it, but I'm a bit of a mac fanboy and this seems to be the shrewdest business move yet by the company. Kudos to you Steve Jobs if this rumor proves to be true. Rather than summarize why I think this is such a good investment, I'll let a post that I stole from Mac Rumors do the talking:

You guys haven't seen what's coming. Do you think Verizon is laying Fiber to the premises just because people want 30Mbps download speeds? NO! The Baby Bells are laying the infrastructure for video services over broadband. Video over IP will be the next "big" thing when the pipes to homes get much fatter. The FCC has already made sure that Cable Ops have to keep their services open enough.

Imagine-

I have a box sitting on top of my TV in 2007. I have one remote for this device. The device has:

Sony/IBM/Toshiba Cell processor- I need Multimedia grunt to encode/decode AVC and MPEG2 in HDTV quality.

Hard Drive Space- 500GB and with AVC at 12Mbps for HD I can record 50 hrs of HD quality or 120 hrs of DVD quality video.

Quicktime - It uses Quicktime so not only can utilize my video codecs but I can play back my Garageband, iPhoto and iMovie files with ease.

Wireless - I have 802.11n with 80Mbs throughput wirelessly. The future may offer Ultra Wideband(UWB) for double the speeds.

Wired Networking - Gigabit and possibly Homeplug AV using Zeroconf for easy network discovery.

iTunes Music Store - Not only can I download iTunes music tracks but I can also download special movie trailers that play in their full glory on my television thanks to the efficient AVC codec. Precursor to movie downloads.

View Photographs- I can view my Photographs in HD glory and watch slideshows from iPhoto.

Music-- Not only can I play back all my files but I can take advantage of multichannel aac files now on iTunes. They play just fine through my AV system.

Guide Data - is free now but the hardware isn't subsidized anymore. I'll pay $250 for a basic machine the Top model includes Wireless access. Bluetooth 2.0 remote and a built in Blu Ray or HD-DVD recorder for $999

This isn't about duplicating Tivo's "Money Pit" people. This is about realizing the change that is coming to the "connected home' and capitalizing on this. People don't even realize that in 3-5 years they will suddenly see their TV Entertainment options go from a few providers to dozens.

Apple knows this..hell Tivo knows this but most consumers do not.