Apple's "hobby" is a mutt of a product, with a bit of Mac Mini, though carefully shortened and made monolithic (drive-slot-less) as an 802.11n AirPort Base Station or Time Capsule looks. Thus Apple TV straddles the gap between Apple's Macintosh products, and Apple's "Appliance" products. Or, it did so when it was new, and the OS X on other-Intel move was a game-changer. Now, the product has languished, and the relic of a bygone creative impulse is Apple's barely adequate iTunes-injecting TV hangaround.
Apple TV prices have not changed as the hardware has aged. The tech specs on Apple TV are very unkind, as it has not been updated since release. It began life as a compromise of sorts, with a bowdlerized Intel Pentium M. Apple TV is not the iPhone/iPod Touch platform, which has already seen a speed jump without breaking compatibility, and represented the cutting edge through 2009. No, the Apple TV is a slick home theater PC from a bygone era, at this point.
Hey, OS X on iPhone runs apps compiled for it on two iterations of the platform and preserves compatibility. (Eventually, original iPhones will strain under the newest games for technical reasons.) At some point, Apple can bifurcate the market with a "iPhone OS 3.0" that leaves the original model out, ala non-Dock connector iPod models, which is required to run the new, complex apps that are too taxing for the rev. A hardware. It seems future cross-compatible iterations of the iPhone OS X platform will coexist. The phone may always be a graphical step behind, but as the beneficiary of pro-equivalent features (like phone calling and SMS) that the Touch will never get, the trade-off is "reasonable."
So what of Apple TV? I have posited a switch from Apple TV to ATV.app for the Mac Mini/a future living room Mac, with everything Apple TV delivers in a Front Row-replacing App. Why not, right? But, Apple is a hardware company...the last project to make the leap from hardware widget to coded app was the GeoPort modem. Maybe there are others, but that came to mind, and sometimes it's nice to get back to the roots.
My point is, Apple usually doesn't lead with hardware, then try to transition to software. They love to make the whole device, and I don't see that changing. A Mac Mini with Apple TV is a Mac with a bolt-on. Apple TV is a pure expression of iTunes on TV. While downplayed, Apple would be unlikely to retreat to Front Row after doing so many "Take"s on their v1.0 living room curiosity. And it will remain that, unless Apple truly cannot build a competitive box without co-opting the price expectations the Mac Mini brand carries, and is forced to merge the lines. That seems unlikely, as $249 to $700 is a leap few would make for a hobbled Mac HTPC. The hardware diversity on the low end of the market, with the Atom, ULV Core chips, and AMD hanging around, has mushroomed. A $249 device with contemporary specs is the new purest expression of an iTunes and TV-centric hardware platform.
As a final prediction, I see Apple TV getting a lot smaller, and inheriting the best of the AirPort stations. Perhaps an antenna port, and certainly an AirTunes/VideoTunes (please?) transport. Perhaps it will gain DisplayPort, too, ensuring that, with enough adapters, it will work with any TV. I think the Atom and Intel Integrated graphics are not going to cut it, and the ATV will continue to ship with Mac-class processors. Apple's move into gaming would be reinforced by a contemporary nVidia/Apple TV, as such a platform begins to crossover into console territory.
So what happens when our posited Apple TV 2.0 lands. Time Capsule functionality (narrowly implemented to ensure your iTunes content is especially safe. I foresee entertainment Macs that backup the agglomerated media of all local computers, and sort and organize it by Apple TV standards.) and, Apple TV is finally able to provide the appliance-style performance of AirPort as well. Display Port, wireless tunes and video, and a Core 2 Duo processor with nVidia graphics that hits the high end-laptop parts bin. Then, Apple's got an iTunes appliance solution (no DVDs, BluRays or CDs; monolithic, driveless, eschewing physical media like the Air), positioned at the very crossroads of content. No keyboard, just the current remote-driven media browsing/buying, Bonjour streaming stuff, and perhaps a mode where a docked iPod Touch or iPhone can act as a game controller or interface device. (Why leave the Wii off of the hit list?)
Ah, flights of fancy. But I mean to say, Apple TV is a hobby like Dreamcast was a hobby for the Windows CE team. Microsoft was learning every step of the way on that dry run before bringing out XBox. Apple TV is a fact finding mission in the wilds of the varied species of digital hubs, each uniquely pruned and tended, a complex market.
Apple TV is a few revisions, probably a small one and then the total redo, away from a revamp that will push it into the middle of the digital media livingroom. At WWDC 2009 I see seminars on porting Touch apps to Apple TV, with the Touch acting as input device.
The Gates/Jobs vision of 2001 supposed a desktop behemoth at the core of the digital hub, providing the logic and the pixel-pushing 'umpf for a galaxy of rather less capable "digital hub" accessories, like digital cameras, DVRs, or video cameras. Indeed, the centralized computational point, the set top box of legend and lore, was sacrosanct to more than Apple and WebTV/Microsoft. No, Vudu, Boxee, and others treat the honing of the perfect hub as the transcendent goal. Meanwhile, media want users, traffic and ads, and they better be measurable. The computer industry agenda is to forge a system in the kiln of company R&D, then obliterate every other box in a battle to set standards. Television is waiting for the squabble to be over. I hope Apple joins the battle, and with a real TV Appliance Mac as described.
The Airport portion of Apple's product line has to get serious about wireless video soon.
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