While Intel does have great technology to bring to the consumer's living room the plan to base the business on streaming live TV is flawed - at least so long as federal regulation gives cable companies unfair advantage and control of the customer experience.
Any company, Intel or Amazon attempting to bypass the cable co's for live TV will face this. Even if the challenges weren't great enough with cable companies having huge marketing and regulatory advantage, there is another issue and that is the reliability (or lack of) of cable Internet service. Most people aren't aware because they don't monitor it but cable Internet service often drops several times throughout the day. Unlike the service reliability rules the FCC applies to basic telephone service there is no equivalent requirement for consumer broadband reliability. It's not a big deal for email when their net connection drops because that email will get delivered when the service returns but it is a big deal if someone is relying on their Internet connection to watch some important live news event.
And no, if someone's Internet service drops it doesn't the entire cable service is out. The Internet service can drop while the cable provided HDTV and phone service continues to work fine. How many times will it take for someone who has switched their TV service entirely to Over The Top streaming to drop before they call up and say, "take this stuff out of my house".
Even though the technology is identical, the business for Netflix style on-demand movies is very different from the business of delivering live TV and it's the latter that hardware vendors will find do difficult to succeed.
Despite all the interviews with Eric Hugger about Intel's plan for Web TV, there is a good chance that business never launches as originally planned. The good news is that it won't make any difference to Intel's overall success.