We know this is going to happen eventually in some form (Ok, I am sure not the only one seeing this and this). The way we watch TV is not going to be the same in the post-torrent world.

From the announcement, quoted:

Highlights:
* Solutions provide lower costs for IPTV operators while offering broader content choices for subscribers
* Reduces the cost of the DVR by using shared disks in the home network
* Using peer-to-peer technology lowers storage and bandwidth overhead of archive-TV for IPTV operators
* Residential Gateway software from Jungo, now part of NDS, works in conjunction with NDS Synamedia Metro(TM) to gather, manage and protect content in home networks and across internet connections

The system consists of 2 components; a distributed DVR set-top box that record and store on any storage devices in the local network. A P2P client that share locally available contents with other in the same P2P network. Contents are encrypted and DRMed.

I suspect this is likely sold by some ISP/cable companies to their subscribers. The box will be setup to join the provider's internal p2p network, which is carried by the its network. Meanwhile, all subscribers on the same network can share contents "legally" among themselves. Of course, this is assuming that the provider has agreement with content providers. The DRM ensure only those in the network can share contents.

In addition, I think one thing it's missing (or not announced) is an infrastructure for the ISP to seed contents, which can be as simple as a bunch of servers connect to the P2P network for others to download from. Once the contents is out there, all users can shared among themselve and allow ISP to use minimal infrastructure to maximize contents distribution.

BTW, Cringely is talking more about how he see Google might rise up to own the Internet and take over our cable and phone here and here I am wondering how this picture fits with NDS's story.... the end-points doesn't seem to be meeting up here...

World's First Peer To Peer DVR From NDS - Gizmodo