Wow. This thing is great on so many levels. With the exception of one conspicuously-missing feature, I’d say Apple has a game-changing device on their hands.

The void that this product fills

On the continuum of multimedia-based, time-wasting activities there is a gap. If traditional television sits at the extreme of the passive / linear / spoon-fed type of media consumption, surfing the web and reading blogs is at the opposite end requiring too much effort and brain involvement for times when you just want to decompress. I just finished setting up an Apple TV box this evening and I’ve been playing with it for about an hour now and this thing falls squarely in the middle of that continuum as an easy way to consume digital multimedia without having to sit in front of a computer screen.

The Apple TV allows you to sync your iTunes via wireless and watch/listen via your entertainment system. It can aggregate media from multiple computers, display photos and album art in the background and has an interface for surfing youtube content (provided it’s connected to the Internet). There was an Apple TV at a birthday party I was at last weekend and it was a blast passing the remote around and be able to pull up an old SNL episode or Mr. T singing about his mom. In the same way that the Nintendo Wii transforms a typically anti-social activity of gaming into a social experience, the Apple TV makes for a fun way of exploring digital content.

Setup happiness

The setup was almost as painless and intuitive as configuring a JumpBox. Running the wires for the component video took the longest time of any step. Once we got the wiring right the on-screen setup of the Apple TV from that point was a snap and took all of about 30sec to connect to the hotspot and start syncing to my iTunes. We did have to disable mac address filtering for it to connect. You pair it like you would a bluetooth device by entering in a combo on the iTunes of the computer which you wish to sync and it does its thing. About an hour later it had successfully synced some 2000 songs, a handful of video podcasts and a movie. You’ll want to pull down the album artwork for your iTunes library if you don’t already have it because it makes flipping through your music feel like flipping through a CD collection.

Usability

The visual interface is clean and what you’d expect from Apple. The remote is the same one that comes with the MacBook laptop and has only a few buttons- it makes the universal remote on the coffee table look like a monster. You navigate a tree of options based on Music, Movies, TV shows, Podcasts, Youtube and device settings. The only thing that’s awkward is typing in characters for a Youtube search via an on-screen keyboard.

Valuable real estate for Apple

I don’t know the numbers on prevalence of Apple TV’s at this point- I would guess it’s just a sliver of the market. But this device represents the “last mile of track” for Apple in a digital entertainment railway into the living room. I can see how owning the iTunes player, the iTunes store and the Apple TV device gives them a wildly-valuable distribution channel for digital media assets.

My perception of the Apple TV before using it was “this could be neat but it seems like a technology solution chasing a problem.” My feelings after having used it is that it makes you forget that you’re using the Internet – it’s more like a Tivo experience than an Internet surfing experience. The interface, transitions and usability that went into it make you want to explore and play with it. By taking a situational vs. feature-centric approach, they zeroed in on the scenarios that people want to use this for and nailed it. There’s only a few minor deficiencies at this point – but like the iPhone, this is a strong first showing for a product.

Enhancements I’d like to see

So the obvious question is “where’s the Rhapsody integration?” They have Youtube integration – this is a glaring omission. There has to be a deal to be made there that makes sense for both companies. They have the ability to log you into your Youtube account so I can’t imagine it’s a technical issue that prevents you from authenticating your Rhapsody acct. It has to be either a political or business issue. Perhaps they see the unlimited access to your Rhapsody music eating away at iTunes purchases? I don’t buy that argument though- there’s no impulse buys via Apple TV like in iTunes because you still have to purchase via your computer.

Wireless keyboard – it has wireless built in but I don’t believe it has bluetooth. I don’t know how much of a stretch it would be for them to add the bluetooth capability or if there’s may an IR-based way of achieving this but it would be nice to see integration with their wireless keyboard. Typing text using the on-screen keyboard is clunky. Of course doing so makes it more like a computer at that point so I’m not completely opposed with how it is now- just would be nice to have that option.UPDATE: the iPhone “Remote” app solves the text entry issue. Sweet.

Be able to treat it as an external HD – I’m running out of disk space on my laptop. I’ve been meaning to buy an external hard drive and offload my iTunes library. I was hoping that I could kill two birds with the Apple TV having it serve that function but it seems it can only sync what exists on my laptop (ie. removing a file from my Mac propagates to the Apple TV and kills it there as well). There may be a way to create a current playlist of all iTunes media, sync it and then disable syncing before removing it from the laptop but that’s hackish. I’d like to see an easy way to treat the Apple TV as an authoritative media base station subscribed to various content and have the syncing work in the other direction with my laptop pulling only a subset of those files.UPDATE:Boxee solves this issue.

Conclusion

This is cool device. I had tinkered with the Democracy player and Joost on my laptop awhile back thinking “wow, power to the people. I’m going to start watching non-mainstream content more” but then I never did because at the end of the day, sometimes you just want to plop on the couch and hit the remote. The Apple TV moves that unique, independent content into the living room where it can compete in watch-ability with movies and TV. I wouldn’t say drop what you’re doing and race out to get one but this definitely a neat addition to a media center and sure to further erode the receding coastline of the TV networks.