Broadly speaking, there exists two apposing camps in the battle to deliver Internet TV into the living room. On one side are devices that connect to and run on the “open” Internet: consumer-facing set-top boxes (think TiVo, AppleTV or Vudu), along with Internet-connected game consoles, DVD players and televisions. On the other side are Internet Protocol Television (IPTV) services offered by major Telcos such as AT&T.

Which of the two strategies will win out in the end is yet to be seen. But one company, Microsoft, has long been spreading it bets — developing consumer-facing Internet TV products along with those sold directly to Telcos and ISPs.

With yesterday’s announcement that BT will soon enable customers of its existing IPTV service, BT Vision (powered my Microsoft’s Mediaroom), to use an XBox 360 instead of its own set-top box, Microsoft has managed to bridge the gap between the two.

Archos, best known for its portable media players, is the latest company to enter the highly competitive and volatile consumer facing set-top box market. Offered in 80GB ($249) and 250GB ($349) versions, the Archos TV+ features TiVo-like DVR functionality, as well as WiFi and Ethernet connectivity to support access to the Internet for web browsing and downloading paid-for video content from CinemaNow. Additionally, the device can operate as a media extender of sorts, to stream content (movies, TV shows, photos and music) from a PC to the TV.

The video Website Veoh is adding — albeit unofficially — more videos from traditional TV networks, with the content this time coming from Hulu, the NBC-Fox joint venture.

Veoh and Hulu have no official partnership. As NewTeeVee notes, Veoh “is basically pulling an OpenHulu — taking the embeds of shows like “30 Rock” and “It’s Always Sunny in Philadelphia” straight from Hulu and plunking them down onto its own site.” The streams do include the original advertising on Hulu.

NewTeeVee quotes Dmitry Shapiro, Veoh founder and chief innovation officer, saying, “Look, people want access to all kinds of content. We are striving to provide access.”

NewTeeVee questions Veoh’s move, contending that it “cheapens” the Veoh brand because it comes off as though “they couldn’t get a straight-up deal with Hulu, so they did a workaround instead.”

The holiday period saw UK Internet TV users being given more viewing options than ever before. Zattoo opened its Beta to the British public and the BBC with its controversial iPlayer – now updated to offer a Flash video-based Mac, Windows and Linux compatible streaming version – did the same.

We first reviewed Zattoo, a P2P-based desktop application that offers live streaming of existing ‘over-the-air’ and cable channels, back in July — noting that in comparison to the likes of Joost and Babelgum, both of which attempt to recreate the “lean back” experience of television, Zattoo is more at home being used “in a multi-tasking environment, where users watch television in one window on their computer, while accomplishing other tasks in another such as chatting to friends over IM, surfing the web or writing email”.

Then in closed Beta, the UK version of Zattoo had a channel lineup which notably included all of the BBC’s digital channels: BBC One, Two, Three, Four, along with BBC Parliament, News 24, and the BBC’s two children’s channels.

Not anymore.

I’m putting on my fantasy hat. Imagine: All of the Netflix movies, television shows, and other content streamed into my living room whenever I want. No more waiting for the post office to deliver the next disk. No more red envelopes to deal with.

Netflix, the DVD-by-mail company with more than seven million subscribers, is partnering with Korean manufacturer LG Electronics to stream movies, TV shows, and other content to LG high-definition televisions or set-top boxes by the second half of 2008.

Reed Hastings, Netflix CEO, said he hopes to strike similar deals with other device manufacturers, potentially creating the Netflix movie channel and seriously challenging other companies attempting to capture the digital-entertainment-in-the-living-room opportunity.

“We want to be integrated on every Internet-connected device, game system, high-definition DVD player and dedicated Internet set-top box,” Hastings said. “Eventually, as TVs have wireless connectivity built into them, we’ll integrate right into the television.”

News this week that less than twelve months into its existence, Wal-Mart’s video download store has closed (Reuters) comes as no surprise.

In a bid to get all of the major studios on board, while at the same time not compete negatively with Wal-Mart’s traditional DVD sales, the service was plagued by high pricing and a ridiculously large dose of DRM (one Windows-PC only). It was doomed from the start.

The folks over at Hulu have made 2500 invites available for the closed beta of the Hulu service for ReadWriteWeb blog network readers (that includes you!).

Hulu is a joint venture between News Corp. and NBC that offers streaming video of both companies’ television and film content along with offerings from other studios such as Sony Pictures Television and MGM. It’s ad supported (via pre and mid-roll ads) and shows include 24, The Simpsons, Family Guy, 30 Rock, The Office, House, and Psych.

Here at last100 we’ve written often about Hulu. Though pre-launch reports were skeptical, once the Beta was launched, early reviews for the service were generally positive.

On the other hand, Read/WriteWeb called Hulu “umpressive,” but now it’s your turn to decide for yourself.

Invites are on a first come basis and are available at this link.

MovieBeam, an early attempt at creating a consumer facing set-top box and accompanying movie service, has closed its doors after fours years in business.

Originally founded by The Walt Disney Company and later sold to U.S. video rental chain Movie Gallery, MovieBeam was designed to bypass Cable and Satelite providers by beaming movies wireless into the home. The set-top box came with dozens of movies already stored and ready for rental (at $5 a pop), with forty new titles refreshed each month. In total the device could store around a hundred movies at any one time.

Meaghan Repko, a spokeswoman for Movie Gallery, told Reuters that MovieBeam had 30 employees and 1,800 subscribers when it shut down, and that subscribers who joined the service in March or later were being refunded the cost of the set-top box.