From it's announcement I've seen the Apple TV as a very niche market. It's basically just for people who own large libraries of videos purchased from the iTunes store...
but the iTunes store is a rip off. If I'm going to buy a movie or show, I'm going to get it (probably for the same price or sometimes cheaper) on DVD, with better video quality, much better portability, availability, etc.
On top of that, I hardly ever buy movies or shows. I don't want to watch most stuff more than once.
I doubt Apple can do it, but I've been intrigued by the idea that Apple could offer essentially a "TV service" that's just a flat monthly fee for all you can watch. As a RENTAL service, the iTunes store would be solid, but Apple has shown no interest in rentals. With such a service, the Apple TV could really be great. Apple could have essentially their own TV service, and instantly be directly competing with regular providers...
but it's not going to happen. Apple's shown no interest in it, and even if they did, content providers would have to agree to it, and the cost couldn't be too high.
As it is, the vast majority of people out there would be far better served by a DVD player than an AppleTV. I think at this point if it sells well, it will actually be because of the Apple name. People buying it without any real idea of what they're going to use it for.
Sidenote-IMO it's inexplicable that AppleTV doesn't support composite and S-Video, especially since it doesn't really even have any HD content (yet anyway). Baffling. But then the entire product is baffling.
Comparisons to the iPod are flawed. The iPod solved an actual problem better than other MP3 players on the market. Other hard drive players were much larger at the time. Flash players were very small in capacity. The iPod had a better screen and interface than most if not all competitors.
Apple TV doesn't solve any problem, except for the small niche of people who have decided to tie themselves to Apple's hardware and software for video, instead of just buying DVDs, which are superior in virtually every regard.
I've also found analysts who compare Apple TV to Tivo or Netflix baffling. Apple TV competes much more directly with Best Buy than it does Tivo or Netflix, both of which essentially provide a ton of great content for a low monthly price (versus providing limited content for a high price).
Personally the DVR market is a little tough to crack as there is no great way to hook one to your TV. I've tried the Tivo method but hated the lag in changing channels. I currently use one my cable provider has provided me since it integrates so nicely with their system.
With Tivo there's no reason to actually change channels. There's no need to "channel browse" on any regular basis. The only reason there's a lag is because it begins recording, and then plays it back from the drive, so you get a second or two while that happens...but like I said, 99% of the time you shouldn't even be directly tuning channels anyway.
Driveless (or small hard drive)
Larger hard drive no DVR
DVR with large hard drive.
I've long thought Apple would be in a position to make a GREAT DVR, and have been surprised that they've never pursued it at all. Unfortunately, the Apple TV is almost contrary to a DVR-since they're now trying to sell content, they're less likely to build a device that lets us capture content from a different source. Someone mentioned a blog about Apple becoming like Sony and losing sight of the big picture-that really may be the case here.
I disagree, they are actually early to a party about to start. In the tech industry, even in the cable companies... IPTV is being heavily researched. All your TV content, distributed over IP instead of antiquated VHF/UHF signals (for digital cable, anyways, basic cable will likely remain as-is for some time to come). Companies like Comcast would only need to distribute new STBs, and they can reclaim chunks of bandwidth currently devoted to OnDemand and PPV channels. IPTV has a fairly fixed bandwidth requirement, regardless of the channel count, unlike current solutions.
Unless Apple starts up their own rental service with a flat fee, Apple TV is nothing like an IPTV service. IPTV won't even be noticed by most users. They'll just switch service providers, or get a new box, or whatever, and not even understand/know they're getting IPTV now.
Not quite the best analogy, but pretty close. Toyota was already a contender in cars before hybrid technology started to materialize into something that could be sold. Here, Apple and Microsoft are both new contenders to the content distribution market... and Microsoft already sees the 360 as a vehicle for IPTV on their terms. I wouldn't be surprised if the Apple TV is an IPTV vehicle for Apple, just that they don't want to sell it based on what it eventually might, possibly, maybe do.
Apple TV isn't anything close to IPTV. What the 360 is going to be doing is actual IPTV, just using the 360 as the box rather than a separate box.
What about 'one touch DVD rip with DRM'?
i.e. iTunes rips the DVD and encodes it with the user's Fairplay user ID such that it's subject to similar usage restrictions as that bought through iTMS.
That's something I've thought about for the last two years. Seems logical to me, and it would help iPod sales explode-even more than they are now.But I think even if they could, Apple won't as they now see themselves as a content provider. Another case like Sony...
IMO Apple's software and hardware choices are beginning to be seriously hurt by the iTunes store.
TV's perceived limitations are software/firmware and content based.
