The set-top box is a piece of hardware that companies like Microsoft, AOL, AT&T, Motorola, Earthlink, and the like believe will change the zillions of TV watchers into zillions of subscribers. This makes perfect sense for content aggregators, since using a set-top box allows data-mining of demographic viewing tendancies (and product placement induced, impulse internet shopping). This information is priceless to media conglomerates that thrive on advertising revenue and brand marketing.
The idea is that set-top boxes will cost less than PCs (lowering the "Cost of Entry") and be easier for Joe Blow to use (by simplifying the User Interface).
A Good Thing about set top boxes is that many run with Linux and FreeBSD and use StrongARM processors.
The big brother of the set-top box is the Internet Appliance.