Google TV is set to launch in Europe early in 2012, following a reboot in the United States that will help developers to create applications for the platform. Dr Eric Schmidt, the chairman of Google, used his keynote speech at the Edinburgh International Television Festival to call for co-operation with the television industry, between the luvvies and boffins, saying Google seeks to be a friend, not a foe, in addressing an increasingly global opportunity. Yet many in the traditionally territorial television industry may still be wary of geeks bearing gifts, suspiciously viewing Google TV as a Trojan horse at the living room door.

It was the first time the prestigious annual MacTaggart lecture has been given by someone not employed in television broadcasting or production. The wide-ranging speech may have benefited from the touch of Peter Barron, the Director of External Relations for Google in Europe, who previously edited Newsnight at the BBC. Clearly keen not to come across as an android engineer, Dr Schmidt’s script was leavened with lighthearted references to the cosy coterie of television that Google has yet to infiltrate, yet its main message was that the internet is fundamental to the future of the medium.

While noting that adults in the United Kingdom still spend as much time watching television in four days as they do on the web in a month, he warned: “You ignore the internet at your peril”.

“The internet is fundamental to the future of television for one simple reason: because it’s what people want,” he said. “Technologically, the internet is a platform for things that traditional TV cannot support. It makes TV more personal, more participative, more pertinent.”

He said that in a world of increasing viewing choice, a system of recommendation is vital. “It’s what channel schedulers have done since the beginning of TV”, he said, “but traditional scheduling is one size fits all.”

“Online, through a combination of algorithms and editorial nudges, suggestions could be individually crafted to suit your interests and needs. The more you watch and share, the more chances the system has to learn, and the better its predictions get. Taken to the ultimate, it would be like the perfect TV channel: always exciting, always relevant — sometimes serendipitous — always worth your time.”

Noting that around 60% of Netflix rentals and up to 30% of Amazon sales are a result of automatically generated recommendations, he acknowledged “delivering on the promise of personalisation is tricky, both technologically and culturally”.

He said it is vital to strike the right balance in terms of privacy, so that people feel comfortable and in control, not disconcerted by the eerie accuracy of suggestions. Despite a fear that filters will become so narrow, we’ll wind up living in a bubble of our own prejudice, he suggested that there should be an element of serendipity by design.

The internet is transforming television choice, promising new forms of interaction. “I remember the excitement about interactive TV a few years ago,” he claimed. “All that drama over pushing a red button. There were a few neat experiences on offer, like playing along with a game show, but on the whole, red button style interaction was pretty limited.”

“Now we’re riding a second, much bigger, wave of interactivity. It’s a convergence of TV and Internet screens. This time the interaction isn’t happening via your red button — it’s on the web through your laptop, tablet or mobile. But most important of all, this time it’s social.”

“History shows that in the face of new technology, those who adapt their business models don’t just survive, they prosper,” he advised. “Technology advances, and no laws can preserve markets that have been passed by. Listen to the entrepreneurs, not the lawyers, if you want to revitalize your business.”

He advocated bridging the divide between the public and private sectors. He said the BBC iPlayer is a great product. “It would be even better if it extended to more channels, as was attempted with Kangaroo,” he said. At the time, Google argued that it did not expect the proposed joint venture between major British broadcasters would have any negative impact on competition or customers and hoped to partner with them. “Despite several valiant attempts, clever lobbying resulted in regulators blocking it — seemingly on the basis that it would be too successful.”

“I know hope lives on in the guise of YouView,” he continued. “But even if YouView meets its revised timetable of launching in 2012, you’ll still have thrown away several years when the UK could have been in the lead — a lifetime technologically.”

That could leave the living room door open for Google TV, despite an inauspicious start in the United States, where broadcast networks quickly blocked access to their online services on the platform.

“We seek to support the content industry by providing an open platform for the next generation of TV to evolve, the same way Android is an open platform for the next generation of mobile. Just as smart-phones sparked a whole new era of innovation for the internet, we hope Google TV can help do the same for television, creating more value for all.”

Refuting the criticism that Google should invest more in programme production, he reiterated that Google is a technology company, with neither the ambition nor the know-how to produce programming on a large scale. “Trust me,” he said, “if you gave people at Google free rein to produce TV you’d end up with a lot of bad sci-fi.”

“The bulk of our investment should focus not on creating content, but on developing platforms, which offer distribution to a global audience of two billion people, free of charge,” he said. “That’s where our strengths lie, and that’s where we can make the biggest contribution to the television industry’s future.”

He stressed that Google respected copyright, responding to takedown requests on YouTube on average in four hours, and developing its content identification system to offer rights holders the option to share in advertising revenues.

“TV is no longer purely a domestic affair,” he said. “Online, any broadcaster can have global reach. Playing to this wider audience needs a new mindset, particularly when it comes to laws and regulation.”

“TV is going global and transforming in form.” He argued for reduced regulation, saying that policy makers should work with the grain of the internet rather than against it.

“Google seeks to be your partner, not your foe,” he concluded. “The opportunities are vast, and British television is uniquely well-placed to take them, if we work together. So think big, think global, and think beyond the TV box.”

It was a clear appeal for reconciliation with an industry that has often regarded Google with suspicion. Whether it will be enough to address their concerns is another matter.

Google TV is about to be relaunched and will be coming to the United Kingdom in a matter of months, probably before YouView reaches any customers. Google TV is coming, ready or not, and that applies to the product as much as to the market. There is still some way to go to articulate a clear proposition for Google TV, to both broadcasters and consumers.

Many may be quick to write off the attempts by Google and Apple, and Microsoft before them, to enter the television territory, but as Eric Schmidt warned, you underestimate the disruptive potential of the internet at your peril.

The 2011 MacTaggart lecture, delivered by Dr Eric Schmidt at the Media Guardian Edinburgh International Television Festival, is available to view on YouTube.