The real problem with ASIC solutions is that they generally have terrible compression; you usually don't get good results until you get up to the range of tens

The real problem with ASIC solutions is that they generally have terrible compression; you usually don't get good results until you get up to the range of tens of thousands of dollars (for real broadcast encoders). Combined with the utter lack of upload bandwidth that most users have, this could become a serious problem. The best option I could see in the near future is ARM's recently-announced 2Ghz quad-core CPU; it's low-power enough and hopefully cheap enough to stick in a small box but fast enough to run a good encoder at a good resolution. But even that would probably put the cost well above $100, at which point you might as well start selling capture cards and using peoples' CPUs instead.