Google TV, designed to make "the TV viewing experience more akin to web browsing" by offering "Internet, IPTV, and multi channel operator content on the TV," is supposed to go on sale at Best Buys this fall; the service looks like serious competition to Comcast and other cable operators, and a challenge, at least in the short run, to TV producers that make their money selling to cable, writes Janney Capital Markets analyst Tony Wible in a short report to clients today. Excerpts:

"Google's push into the living room is likely to be met with resistance by most multi channel operators, which would likely view the product as a threat to their existing business... Google's willingness to aggregate Internet content could accelerate cord cutting or cord shaving that would impair multi channel operations and the massive fees content producers collect from these operators...

"We estimate cable operators alone spend over $18 billion a year on content, while spending $15 billion a year on capital expenditures. These massive cash flows will likely keep interests of operators and content producers aligned for the foreseeable future...

"Even Google will face hurdles from political alliances and hardware limitations.... A rollout will take years to implement... It is difficult to add new devices in the living room." For example, Microsoft's Ultimate TV and Apple TV "have struggled." Though if it works for Google, Microsoft will be there, too, Wible adds. And cable companies could still get there first.

Who benefits? Over time, "we see the value of content increasing as distribution becomes more commoditized... which should increase the leverage content producers have with all their distribution partners -- multi-channel operators and IPTV outlets. We believe this will manifest as higher affiliate/retrans fees and/or licensing rates."

Will advertisers back Google TV? Yes, says Bloomberg here. Separately: Congress wants to write a new telecommunications law restating FCC powers. Analyst Craig Moffet of Bernstein Research says that's good news for the cable companies, because Congress is less likely than the FCC to try to limit the fees the companies charge consumers. Rockefeller-Waxman statement here. FT story here.