The analysts are finally confirming what we've known all along. Apple TV isn't a big deal. Market research firm Forrester reports that they estimate Apple will be lucky to sell 800,000 units by the end of this year, or 200,000 short of Forrester's 1 million unit estimation. So do they blame the marketing? No, plenty of internet-using adults know about the product (around 50%), but only 5% of those people know what it does. What's the problem? Forrester actually blames iTunes video for failing the hardware. A software platform that hasn't taken over at the level of music, Forrester thinks that you have to get the consumers watching iTunes movies before Apple can sell the hardware intended to streamline their playback.
I think that the device is just too niche in a consumer's entertainment workflow to swallow. "So wait, I have to buy this just to watch my movie on my TV? Why don't I just watch a DVD then? Or you know, the non-Apple variety of television." If everyone has heard of your product but no one knows what it does, you have to wonder how important its function is to consumers.
But as Jobs himself said, Apple TV is just a "hobby." [pcworld]