I'm LOVIN' my ATV and the article is dead wrong. We bought it to rent movies online. Period. On that basis we have not been disappointed. We haven't been to the video store now in about 15 months and we typically rent a couple of movies every weekend from iTunes in HD. No more late fees, no starting up the car to head to the video store for pickup and returns, no waiting in line, Movies are NEVER SOLD OUT, etc, etc. ATV even lets us watch a trailer of every movie we're interested in to see if we want to watch it. Movie rental prices are consistent with our local video store as well. (In Canada, $5.99 for HD and $4.99 for SD. 30 days to play and 48 hours once you've authorized the movie)
It's only 720P?, couldn't care less. I'm running a new 52" LCD and the HD quality on our movie rentals is easily as good as the best HD TV signal I've seen. It's not Blu-Ray good but it's good enough and certainly better than DVD. Movie streaming speed is fast too with an HD rental typically ready to play in about 10 seconds on our high speed cable.
In Canada, we have no other alternatives to online movie rentals that I'm aware of, unlike the U.S. so ATV is it. The extra's like music and picture streaming, Youtube, Internet radio, etc. are just the icing on the cake. For $250 Cdn, it does exactly what we wanted and is a nice compliment to a home theatre system. I also have PS3 for Blu-Ray and DVD so that's covered as well but the vast majority (90%) of our movie watching is ATV.
The only issue I have with ATV is the typical 30 day delay in waiting for some movies to hit the rental section but that's a Studio issue, not an Apple one. Some movies show up quickly for rent but we figure that's usually a studio test to see how digital distribution is fitting into their marketing plans. I'm willing to bet the 30 day window is going to keep shortening up as the studios start to accommodate the public demand for digital distribution. Video stores are going to go the way of the dinosaur in pretty short order is my bet.
I can also say that EVERYONE that we have had over in the last year has ended up buying one of these things, once they understood what it was all about (a dozen plus people so far) and that just leads me to believe that the ATV has been poorly marketed by Apple in that most people just don't get what the ATV is all about. Once they play with it for a while then the perception changes almost instantly. My wife thought I was nuts when I bought it and now she would probably have me killed if I ever tried to take it away. That pretty much sums it up right there....
Cheers!
P.S. I should add that there is one other alternative in Canada for online rental of movies, the cable companies. Sorry, forgot about that one. However, I've found their prices to be ridiculously high (at least with Shaw) and the only HD movie we rented had noticeable lag when anything was moving fast on the screen. The selection is also very poor, the interface is slow and no trailers. Just sayin'...
James