Apple is dragging its collective feet on moving the Apple TV, but the clock is ticking. According to a new study by Research and Markets, North America, Europe, Asia and first world countries in Australia have passed the tipping point when it comes to consumer acceptance and desire for Internet-delivered video entertainment.

Web sites like YouTube, Hulu and the BBC’s iPlayer have already attracted millions of viewers. The only pending question is how those videos will be delivered to TV sets. Will it be separate boxes that connect the Internet to a TV set like Apple TV and Netflix’s Roku box? Will services shift to being built in the TV set or Blu-ray players like Yahoo with its Widgets and Netflix with upcoming TVs?

Netflix, YouTube and Yahoo have placed themselves and their content on TV sets in brand new ways. Viewers are changing their consumption habits as the market shifts, which is why sites like Hulu.com are seeing impressive numbers of visitors, time spent watching videos and gaining ad dollars.

Research and Markets says users are making choices based on the economy, which means choosing Netflix over the theater, Slingbox over additional cable boxes and Google’s office suite over Microsoft ’s. The players in this game are huge and range from networks and pay-TV providers to Internet giants and the biggest names in computers and consumer electronics. The winners will end up being those with the best services and offerings, and in this market that could mean they’ll be the ones that played best with others, says Research and Markets.

Meanwhile, Apple continues to call the Apple TV a “hobby.”

I really don't understand Apple's game here.
They've done so little when they could have done so much already - though I recognise that people are only just starting to understand the possibilities.

I HOPE we will see a leap forward with a new device... but who knows.

I don't understand Apple's marketing sometimes. Look how they advertise the iPhone on TV with example of how it works. Maybe they would sell more Apple TVs and it would catch on more if they done the same thing???

I'd LOVE to have an Apple TV but given Apple's response that its just at 'hobby' why do they think I'm willing to put down that money when its so limited?

Friends have MacMini's connected to their TV for NetFlix and full internet.

Maybe Apple has just to much on its plate or do they view the MOBILE (iPhone, Netbooks) to be the direction people will go to?

Maybe one day they'll focus on it!

To me it's a lot easier to understand the tv when I realize that the main design consideration was a device to make it easier and more convenient to purchase content from the iTunes Store.

Being a full service "set top box" was never an intended use.

If you are fine with that source of your media content then it is a great unit. However, if you want other choices then you are better off with a mini or other set top choice.

In my case, my tv moved down the road on eBay and I use my MacBook as a media server.

The last thing I'd buy is a box that locked me into only one source when so many are available. Thus I'll pass on the Apple TV. The Mac Mini is a much more likely purchase (but it needs a lower price). Currently I just connect my MacBook when I need to stream videos from the web or view video files.

I agree with Rick and talmy about the "locked in" aspect of ATV but the realization that I buy 98% of my digital content from the ITS was enough for me to take the plunge. That said, and having posted elsewhere here, I wish Apple would take ATV seriously and at least take the next logical step; i.e. transform ATV into a server-like device that would let me access all of the digital content I purchased or burned from other legal sources without tying access into a simultaneously running Mac running iTunes - even if that purchased content is only from the ITS and not purchased elsewhere.

The biggest pain in the a** about ATV right now is it's limited resident storage and its inability to access other digital content from an external HD without the go-between of a running Mac running iTunes. The need to juggle my digital content via a Mac and then sync it with ATV just blows; I'd like the ability to access anything I have (movies, podcasts, music, etc.) whenever I want, depending on my mood at that moment as I'm clicking the ATV remote downstairs. What this has to do with DRM or any other factor is beyond me.

Apple has a couple of problems here.

1. The Apple TV is too expensive. They need a box for $149 entry level. Put a gig of flash memory in it for buffering content and storing a little bit of media.

2. The Apple TV needs to become more of a Consumer Electronics device (CE) simply putting in computer parts and a remote and calling something a CE device is a bit of a misnomer. Move the platform to ARM based processing with Imagination PowerVR GPU and HD decoding.

3. Enable support for 1080p video even if itunes only supports 720p downloads. The proliferation of HD cameras for the home will create a huge amount of HD content that dwarfts what's available on iTunes.

4. Ship it with a real remote.

5. Make the Apple TV software smarter. I should be able to run the ATV software on a computer as yet another node. I should be able to zone each computer or ATV node. So that I can easily move my content around (i.e. esume playback in bedroom etc) via a recognizable name.

6. Allow the Apple TV to stream content from your basic NAS running CIFS/NFS. This way I can consolidate my storage to a box holding the most dense HDD which are cheaper per Gigabyte. These boxes also consume less power meaning they can run and serve media content without sucking up a bunch of power.

Apple's silence in the future of Apple TV probably dovetails their silence on adding more meaningful features to iTunes. Frankly...adding HD Rentals and buying does little for me because there's not an appropriate ecosystem that this meadia resides in that delivers a superior experience to placing a plastic disc into an optical player.

I'm a new visitor here. As I view this issue, Apple executives are not really dragging their collective feet on AppleTV.

Rather, I think the movie studio's still are severely limiting access to movies so that they can sell limited rights in multiple, competing markets, multiple times to maximize products. This complicated distribution system is holding back online distribution. In the best of all worlds (for consumers), all movies would be made available through all distribution systems simultaneously.

But the traditional distributors (Theaters, DVD rental and sales firms, retailers, cable and broadcast channels) really fear Apple and all the new age online download distributors. The studios are trying to hold onto their existing system (and cash flow) while phasing in online sales. So, theaters get the movie rights first (for a limited time). In some instances, the rights to (very) few, newer movies are even being sold experimentally to online distributors like Apple at the same time DVD's are released, but this is not the case for most. Then the rights are resold again for the DVD market and simultaneously, some movies are relicensed for exclusive, but time-limited use by cable and broadcast TV networks. Finally, the movies are made available to Apple and other online movies for another limited run. Then, the whole process starts all over again.

This is all about protecting existing business relationships and cash flows. My take is that Apple is moving slowly so that when they finally relaunch a revamped AppleTV, they can try to do it with more rights to more movies, be they rental or sales. Also, the broadband bandwidth issue is a huge problem for HD downloads. Most Americans have relatively slow broadband Internet. For instance, Comcast is one of the larger ISPs and their internet service remains very slow in many local markets. It will be another two years before Comcast has the technology in place to offer truly fast broadband Internet nationwide. And don't forget the bandwidth caps that are being put in place by cable companies to prevent Apple and other competitors from poaching movie rental business from this industry.

When you think about all this, the transition to digital downloads really is a mess. The movie studios are dragging this out, not Apple, and there is a very long line of problems that new players like Apple have to solve.

Also, it was only two or three months ago that Apple finally got around to surveying existing AppleTV customers about what features they wanted to see in the next AppleTV model. I fear this fact alone means we won't see a revised AppleTV for many months. I hope I'm wrong, because I'm trying to decide whether to get AppleTV or a Mac mini right now. The AppleTV just is not full-featured enough (needs gaming and Safari Internet access among other things), but I fear the Mac mini will be rendered obsolete by a revamped AppleTV.