As the Radioactive Yak reports, Google has started accepting resume's for an Interactive TV Product Manager in the Mountain View and software engineers experienced in "emerging TV standards" at the Mountain View and London locations.
Google owns some domain names that seem to back up this speculation: googledvr.net and googledvr.org. They currently do not own the .COM version of this domain, but I am sure they will have a good case against the current owner if they really want it. Some more domains Google owns that are related to this are: googletv.com, googlehtdv.net and more.
Back in Ocbober, the New York Times published an interesting article that quoted Eric Schmidt as saying they are definitely interested in the Television space.
Google already sells its text ads for many other sites on the Internet (including nytimes.com), and is also moving tentatively to sell the picture-based interactive advertising preferred by marketers who want to promote brands rather than immediately sell products. Now it is preparing to extend its technology to nearly every other medium, most significantly television. It is looking toward a world of digital cable boxes and Internet-delivered television that will allow it to show commercials tailored for each viewer, as it does now for each Web page it displays.
This proposition, he continued, is applicable to other media. "If we can figure out a way to improve the quality of ads on television with ads that have real value for end-users, we should do it," he said. While he is watching television, for example, "Why do I see women's clothing ads?" he said. "Why don't I see just men's clothing ads?"
It would make sense for Google to create their own branded DVR box that requires users to log in with their Google Account. With the information Google knows about you, it would be easy to display relevant television ads intended for the viewer rather than blanket commercial spots. With this type of model, any business could afford to advertise on TV -- that is a very powerful idea.
A digital video box would also let users access common Google functions right on your TV -- like checking mail or searching for something. Maybe one day Google will merge the internet with our television to keep us productive, even when we're watching TV.