First Apple TV Units Could Be In Stores Within Days

Rots of ruck, dudes!

Apple is poised to make its first major pitch to couch potatoes with the release of a video-streaming set-top box for the television. Industry sources say the Cupertino, Calif., company will ship the $299 product, called Apple TV, on Tuesday, about three weeks later than Apple originally planned. The company hasn't confirmed a launch date.

Apple hopes to have the same success with video in the living room that it's had with music on the go with the iPod. But the Apple TV is far from a guaranteed hit, even though it doesn't face any direct competition as an Internet video device.

Analysts say it's likely to sell well initially. The company has taken pre-orders for more than 100,000 units, analysts say. But how well the product sells after that initial wave will depend on word of mouth and the ability of Apple store employees to demonstrate it persuasively.

Apple TV is a huge deal for the consumer electronics industry, says Tim Bajarin, an analyst with the research firm Creative Strategies.

"It will be the first product that really gets the mainstream consumer interested in moving PC content to the television for viewing on a TV set," Bajarin said. Other devices can do that today, but Apple has shown an ability to make simple, easy-to-use products.

With Apple TV, people can access via remote control movies and TV shows purchased from Apple's iTunes download store. The set-top box links to Apple Macintosh computers and PCs running Microsoft's (MSFT) Windows XP operating system using existing wireless and wired networks.

The device could have limited appeal beyond consumers who have bought a lot of videos off iTunes, analysts say.

"Consumers need to invest in enough video content to justify the purchase," said Josh Martin, an analyst with the Yankee Group, a research firm. "It's not like where you have 100 CDs and you can rip them (to your PC) and all of a sudden you have a cache of content for your iPod."

While copying music CDs to your PC is considered fair use, copying DVD movies to your PC is considered illegal, Martin says.

Apple CEO Jobs has positioned the Apple TV as a replacement for the DVD player. But it will take time for consumers to get used to the idea of buying purely digital versions of movies, Martin says.

Also, many consumers might find Apple TV limiting because it can play only videos purchased from iTunes. And unlike other Internet movie services, such as CinemaNow and Movielink, it doesn't let people rent videos or subscribe to an all-you-can-watch service.

"Apple lives in a closed-ended world," said James McQuivey, an analyst with Forrester Research.

For the same $300 it costs to get a dedicated video-streaming device such as Apple TV, you could buy a much more capable Xbox 360 from Microsoft, he says. The Xbox 360 is a video game console as well as a video-download device. And Xbox 360 offers movie downloads in high definition, something Apple TV doesn't offer.

"Three hundred dollars is a lot to spend just to extend the functionality of your iTunes account," McQuivey said.

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