The Apple TV as a set-top box for cable TV? That's what Apple is aiming for, according to sources speaking to the Wall Street Journal. The company is reportedly in talks with cable operators in the US to bring live TV—as well as "other content"—to the living room, though no deals have been solidified as of yet.

The Apple TV was released in 2007 as a "hobby" device that could bring iTunes content to the television set. More than five years later, Apple maintains that it's still a hobby, despite selling 4 million devices so far in 2012 (with one fiscal quarter left to go). "It's still at a level that we would call it a hobby, but we continue to pull strings to see where it takes us. We're not one to keep around projects that we don't believe in," Apple CEO Tim Cook said during the company's third quarter conference call in July. "The 4 million is not a small number. It's small relative to iPads and iPhones perhaps, but it's not a small number."

Apple has progressively added more and more non-Apple content to the Apple TV, including access to Netflix, Hulu Plus, and some sports (NBA and MLB). But Apple's biggest challenge has always been the cable TV market, which has long resisted Apple's overtures when it comes to content. Many cable TV shows are not available on iTunes until long after their seasons are over, leading consumers to choose other options for TV consumption—often the traditional cable subscriptions Apple TV could circumvent.

Indeed, according to the WSJ, sources indicated that Apple continues to face an uphill battle when it comes to wooing cable operators. "One obstacle may be the reluctance of operators to let Apple establish a foothold in the television business," wrote the WSJ. Also, Apple reportedly wants to deliver content over IP, essentially turning cable operators into dumb pipes—something they undoubtedly do not want.

Despite this, two sources indicated that a cable-compatible Apple TV could eventually be integrated into a television set, fueling the ongoing rumors about Apple's plans to release a TV. Former Apple CEO Steve Jobs reportedly declared to biographer Walter Isaacson that he had "cracked" the concept of an Apple-branded television set, and Reuters reported earlier this year that such a device was indeed in the works. The WSJ's sources gave no indication that Apple would be releasing its own TV set in the near future, however.

Update (Thursday, August 16): The original story (above) was published on Wednesday evening. The Wall Street Journal is now offering new details on Apple's alleged vision for its set-top box, which Apple hopes to use to "erase the distinction between live and on-demand content." Users will reportedly be able to start any show at any time, and the UI is said to resemble icons on the iPad.