According to the New York Times, Google is working on a set-top box that will integrate web services like Twitter and Facebook with sites like Hulu, YouTube and Google's own PIcasa. The Google TV, as the Times calls it, will be based on the Android operating system, and a toolkit will be made available to developers within the next couple of months.
As for Google's partners, Sony has been tapped to develop the platform, Logitech will make peripherals and Intel will manufacture the chips. In fact, Intel recently posted job listings for Android developers who can extend technology "...from PC screen to mobile screen and TV screen."
As a front end to the iTunes Store, the Apple TV does its job well. But people obviously want it to do more. As computers and TVs merge into a single device, Apple should identify a clear role for its hobby; either make it a competitor or a toy.