The Apple TV works with wifi and I would assume the new one will as well. As for convenience, not all people have a notebook they can hook to their tv. Some have desktops. Even for people that have notebooks, it is not very convenient to have to hook it up all the time just to watch video content and the experience, UI, and ability to control it all is subpar.
Not to mention I like to browse around on the internet using my notebook while watching tv/video on my TV. I wouldn't be able to do that if my notebook has to be connected to the TV. And I'm not dropping another $500-$1500 on another small form factor just to make that happen. And definitely not spending that much money to make that happen for every important TV I own. On the other hand, I would buy a $99 device to accomplish the same in my home office, master bedroom, and the family room. A total of $300 to do all 3 rooms would still be less than adding a full fledged computer in 1 room just to be able to watch video and play music with a subpar interface and higher energy costs.
It's a no brainer in my book if the rumored $99 price is real.