Apple TV is weird in that it’s not a complete “top-to-bottom” solution like most of Apple’s products. It doesn’t replace your DVD player, it only plays a handful of video formats (so a lot of videos you have may not work with it without conversion), and it can play some types of content on-the-fly (movies) but not others (TV shows). It becomes just another box to add to the stack you already have under your TV.

I think for Apple TV to really take off, Apple needs to treat it like its other products. Make it THE one device you need that handles *everything* you’d ever want to do with your TV. Let you hook up external DVD and Blu-ray drives through USB. Add Remote Disc support so you use your computer as a DVD player. Let you stream and download both movies and TV shows. Allow you to plug in external USB hard drives to expand storage, so you’re not stuck filling up your computer’s hard drive or constantly swapping stuff on and off the Apple TV. Add support for more video formats so it can instantly play anything you throw at it. Etc.

My use never seems to get mentioned by anyone else, though others must do the same. I pump my lossless ripped music collection out through the optical-digital into a decent DAC for serious HiFi listening. Not as good as the dedicated CD player (an unfair comparison because of price) but it’s so acceptable that I rarely bother putting CDs on now, preferring AppleTV convenience, especially when combined with iPhone remote meaning my TV doesn’t have to be on at the same time.

Never buy anything though, so perhaps I’m not their favourite customer. Watching on-demand streamed Vodcasts from my armchair is another revelation on how TV really should be in the 21stC.

AppleTV should go bigger and better IMHO. Me want a full on media hub as an independent home for my iTunes library.