A full-blown Apple Smart TV is in the works, according to Steve Jobs' biography by Walter Isaacson, which reveals that Jobs wanted to create a television with a simple user interface, rescuing consumers from multiple confusing remotes.

It will have the simplest user interface you could imagine, and I finally cracked it, Isaacson said quoting Jobs.

The market has been speculating for years that Apple would make a full-fledged television and there were reports that Apple Smart TV, also called iTV, was already flowing through factories over in China in early stage pilot and prototype production.

The latest revelation only confirmed the rumors surrounding Apple TV and Jefferies believes Apple would launch a new video-focused cloud-based service called iTV in the second half of calendar 2012.

Jefferies analyst Peter Misek said his recent checks point to further confirmation that an iTV launch is planned in the second half of calendar 2012 with initial builds of 5 million to 10 million-plus.

Meanwhile, the Smart TV represents $100 billion revenue opportunity for Apple. DisplaySearch estimates the LCD TV market will generate $100 billion in revenue this year and reach $102 billion in 2012.

For Apple, we believe the Smart TV market represents a significant new revenue opportunity for the company, while bringing Apple into a consumer's living room and providing the digital hub in a home, Ticonderoga Securities analyst Brian White wrote in a note to clients.

White said the product could hit the market in the coming quarters, opening up a new growth category for Apple and driving sales of existing products that play into the Apple digital ecosystem.

In addition, a Smart TV would be another feather in the cap for Apple's ecosystem and would boost demand for existing products.

We believe Apple will be able to charge a price for a new Smart TV that is 2-3x the competitor's LCD TV products due to the Apple brand, unmatched aesthetics, expansive digital ecosystem and overall quality, said White.

If Apple started to sell a TV, there is no doubt that its margins and pricing could be industry leading, given its dominance in the supply chain and its potential to drive premium pricing.

In addition, Apple's Smart TV is expected to feature Siri, FaceTime, the App Store, iTunes and gaming, combined with potential new features and technologies in the future. The analyst also expects Apple TV to sync up with iCloud, similar to other Apple devices.

Products and services could be offered and sold on Apple TV via iTunes, while Apple could also leverage its iAd program. Apple already has great content relationships and will likely need to further expand these ties.

On the earnings front, according to Barclays analyst Ben Reitzes, if Apple were to sell a television, he believes that an iTV can contribute over $4.50 in earnings per share (EPS) well within 5 years.

Assuming Apple could get a 5 percent share of the TV market over time, with an average selling price of $1,500, the new segment could equate to over $19 billion in revenue or about 11 percent of his fiscal 2013 revenue estimate of $166.5 billion.

Assuming a gross margin of about 30 percent, the incremental margin dollars could contribute about $4.50 to EPS or 11 percent of our FY13 EPS estimate of $39.60, Reitzes said.