According to Bloomberg, Sony will announce at Google I/O the creation of a Google TV service. The TVs will be a part of a home entertainment system, with Intel providing the processors, Sony building the TVs, Google making the software, and Logitech creating the peripherals. AndroidandMe suggests that the OS for the TV, Dragonpoint, will be a derivative of Android Froyo, featuring Flash support.
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As for the naming scheme, AndroidGuys made a decent prediction:
We're going to go ahead and say this name will be a play on words "Drag N' Point". The name alone already has us conjuring up ideas of pointing and dragging icons, apps, and typing with a keyboard that uses dragging. Swype anyone?
Adopting a mobile OS for use on a TV is no simple undertaking as Gizmodo points out, saying "To adapt a mobile OS to TVs is something else entirely: easier in some ways, since the OS is already suited to remote-control-style navigation, by virtue of having been built around devices with d-pads and a handful of buttons; and harder in others, since it was designed for use on palm-sized screens."
Image from AndroidGuys