As a follow up to my , the New York Times has on article on Apple's Plans to Inhabit Living Room.

"Steven P. Jobs, Apple Computer’s chief executive, concluded a much-anticipated company event on Tuesday with his usual tease, noting that he had “one last thing” to introduce.

"Then, in an unusual departure from Apple’s practice of announcing new products when they are ready to ship, he talked about a product due out early next year that will be the company’s first step into the living room. The device, which Apple is calling iTV for now, will plug into a television and wirelessly pull in video and music from a Macintosh computer in the den or from the Internet. The box, which will cost $299, is about the size of a slim paperback novel.

"The iTV device places Apple squarely in the consumer electronics market and gives it a way to compete directly with Microsoft and PC industry giants like Dell and Hewlett-Packard, which are also eagerly looking at markets for entertainment beyond the PC screen.

“He did what he needed to do,” said Michael Gartenberg, vice president and research director for Jupiter Research. “It puts him way ahead of everyone else” in the effort to extend the PC to the living room."

Really? I'm not sure how the "iTV" announcement "puts him way ahead of everyone else."

Video downloaded via the Internet is one way to get your content, arguably one that is growing in popularity as people develop better distribution systems and business models. Streaming video is getting better with reasonable quality as I found with . People are changing the way they look at their PCs and their TVs, per my post on "The end of TV as we know it." 

As I mentioned last month, look what happened when Disney's opened the gates to content on the Internet: they had “37 million downloads, with an average of 1 million visitors a day, and 1.5 billion page views” over a two month period this summer, when they had Disney Channel shows available on DisneyChannel.com. That sounds like a successful model to me.

When the movie and TV studios open up their catalogues and sell more movies and shows over the entertainment sites like Rhapsody, Urge and through iTunes, then we as consumers may no longer need to record live TV, as we do at home for nearly all our viewing. But that day is still a long time away, IMHO: there are plenty of issues yet to be resolved, around how much to charge for programs, how consumers and studios become more comfortable with the protections (like DRM) around what is sold/rented, and when to make the content available (like we see sometimes with simultaneous theatrical and on-demand releases).

For now, the DVR model works for personal, "on-demand" programming, whether you record the content via a Windows Media Center, ReplayTV or TiVo CE device, or if DVR is offered as a feature with your cable or satellite set-top box. That way, you always have what you want to watch available at your leisure. On-demand consumption via cable is growing, too, especially as more and more popular programming is made available and (in my view) often free. Then comes Blockbuster and Netflix model for renting early release movies and large catalogues of films via mail order still has an appeal: personally, I find that we receive DVDs a day or two within ordering them. These are some competitive distribution and business model points for the studios.

The "revolution" that Jobs talks about is not only being held back by current limitations in Internet download speeds, it's around comfort in the business models of getting content to the home, and the restrictions around how people are allowed to view or listen to it. As I've said previously, Rhapsody has changed the way I listen to music, my ReplayTV changed the way I watch TV, and the Media Center is aggregating all of it on one device -- one system -- that let's me almost seamlessly consume (view, listen) to the content I want. For many consumers, the challenge has been the way to get the content to the devices I want that is more automated than the way I sync phones, audio and video players to my Media Center: I look forward to being able to extend my content easily to my portable devices, similar to the way I use the Media Center Extender concept via our home network. (Sling is close, but not as seamless as I'd like.)

It's not just the Internet or the speed of the network. It's not the last mile or the last 100 feet to the home, as we're getting speeds to households that are capable of getting VHS and (close to or at) DVD quality. The challenge is in the last 10 feet: as a content company or distributor, how do you get consumers to pay for something, making it easy for them to buy and consume at the point of purchase? In this case, that point is the TV (or the DVR/PC connected to a TV). It's also the PC, mobile phone, the portable and eventually wireless media players (Zune can't come fast enough).

This is where I think Jobs' value proposition of an end-to-end system works... that is if you have a Mac, and iTunes, and an iPod and an iTV adapter. For those who manage their content in iTunes, I see the elegance. With Apple's vision of a holistic system, there is the promise of being able to provide a compelling home entertainment experience, just like the cable and satellite companies offer in so many packages today. But I have that experience at home today with a Media Center PC at the center of our entertainment universe, and it's by no means the sole way we enjoy entertainment, and that's the real goal: enjoying the programming.

One challenge is that cable and satellite offer this at a fairly attractive monthly price, one that has a low barrier to entry and is arguably easier to use for mainstream consumers. For some, the Media Center makes sense; for many more, a as a simpler alternative in cable and satellite all-in-one set-top boxes make more sense as does the promise of video over IP as outlined in our Microsoft IPTV solutions. And look at another example: as Major Nelson blogged, "Xbox Live users in the U.S. can now download the full length TV show 'Battlestar Galactica: The Story So Far' in standard def from the Xbox Live Marketplace. Just in case you are wondering, this marks one of the first times that a complete TV episode has been digitally delivered to your Xbox 360 over Xbox Live."

To the industry and even our own teams in MSN, Live, Xbox and Zune: make it easier to get the programming in a form that I can enjoy it and wrap it in a business model I can grok. For my family, that simplicity is in a set monthly fee for services that we pay for our mobile phones, music service, cable/ satellite TV and DVDs by mail. 

In short, many people would rather not have to be an IT Professional debugging our internet connection or home network in order to watch the latest episode of Project Runway. It should just work. And it shouldn't cost $1.99 an episode.

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