Now, I love my appleTV - I use it every day. But I can see exactly why it has not taken off like an ipod, iphone or itunes.
From a marketing perspective, those three are easy sells to the non-technologically competant person.
With the ipod, it directly replaced walkmans/discmans with a significantly better, smaller cooler product that was easy to use.
With the iphone, everyone wanted a phone that had smartphone features - but the offerings from blackberry, nokia etc. were too difficult to use for non-technologically minded people. Apple made internet access, music playing, email and PDA functions EASY on the iphone. Yes, you could do it on other devices, but could your mother or grandmother do it? No.
With itunes, the seller is the content and the ease of use. If you want a PARTICULAR track or album, 99% of the time you know it will be on itunes. Compare that to trawling through a record shop that might or might not have what you are looking for, and the fact you can do it from home, and you have a winner.
Now, the apple TV. What does that make easier for a non-technologically minded person?
Listening to your own music? No. Not unless you have a receiver/speaker setup (which the non-technologically minded person doesn't). Even if they have their content on itunes, they are still more likely to listen to it on either (1) their ipod or (2) at home on their CD-playing stereo. Not on their TV.
Watching their own movies? No. Not when you have to spend hours ripping dvd's and converting them into the correct format. I think for the average person it is still a lot easier to put a DVD into your DVD player and press play.
Using YouTube/Flickr/iTunes Store etc? These are great features on the ATV, but they are not selling points. Not when it is just as easy to use the same functions on your pc or mac.
Purchasing TV shows? Definately not. The average consumer wants to watch TV (currently anyway) by switching on their TV set and watching. It is a fundamentally passive activity - consumers want their TV content to be delivered to them - not to have to decide what content they want to watch.
The one, and possibly only HUGE selling point the ATV has is movie rentals. This is something that the average non-technological person (1) wants to do - they are already renting movies, and have been for years (2) is an improvement over the current way of doing it. It is undeniably easier to download a movie and watch it on your ATV than it is to rent a DVD from blockbuster.
I think Apple realised this as well, and it is why it was the centrepiece of the 2.0 re-take.
From here, it is a marketing problem. I'm in Australia, so I don't know what the situation is like in the US and Europe, but the the marketing for ATV over here is non-existant.
Most non-technologically minded consumers know exactly what and ipod is, and iphone is and most know what itunes it.
Most have no idea what an AppleTV is, why they would want to buy it, and have no idea that you can rent movies with it.
This is a major problem, as downloadable movie rentals is something that everyone is doing - not just apple. All the cable companies, as well as a lot of other providers are going down that path.
There is no clear winner as yet, and if Apple keep up their current marketing strategy it is not going to be them.
iTunes makes movie renting easy. But people don't want to watch rented movies on their computer, most not on their ipod either. Most people want to sit down and watch them on their TV, the way they always have. And Apple has a good, easy to use product that delivers exactly that. The problem is that noone knows it exists.
TV is clearly ahead of its time. I think Apple is waiting for all the chess pieces to fall in place. Once they have all the TV and movie contracts worked out and a fairly large library in place, I think Apple will drop the "hobby" title and begin marketing 