Five Ways to Save Apple TV

So, is it time to call Apple TV a flop? That's what Forbes and CNET are saying, and they have the numbers to back them up: fewer than 250,000 boxes sold in six months. Not good. But Apple TV can still be saved: here are five ways to do it.

First, a little history: Apple TV was announced with great fanfare back in September 2006, along with a new movie store on iTunes, and at the time, Apple seemed poised to dominate online videos in the same way that it did with online music. But then a funny thing (or things) happened on the way to digital video domination: Apple's competitors started to catch up. The impressive Xbox Video Marketplace (complete with HD video) launched a couple of months later, Amazon Unbox debuted and later added TiVo support, and the big TV and movie studios suddenly realized that iTunes wasn't the only game in town when it came to video. Meanwhile, the March launch of Apple TV was underwhelming: yes, iTunes video was coming to your TV, but no HD, and you couldn't buy video over the Apple TV itself.

Here's the thing, though: there are still several ways to substantially improve Apple TV, and none of them require new hardware. Most of these ideas have been bandied about before (and CNET's John Falcone covers some of the same ideas as well), but they're worth repeating: and who knows, maybe Steve Jobs—who seems to have dismissed Apple TV as a "hobby"—just might listen if we yell loud enough.

1. Bring the iTunes store to Apple TV: It's such an obvious idea, mentioned many times before (and it's one of Falcone's biggest suggestion)—so obvious, in fact, that I'm baffled that it hasn't already been launched. After all, we have the iTunes store on the iPhone and the iPod Touch, and the experience works perfectly (everything you buy gets transferred to your iTunes library once you sync), so why not on Apple TV? And of coure, the Xbox Video Marketplace and Amazon Unbox over TiVo let you buy videos on your TV.
2. HD movies and TV shows: As Falcone points out, picture quality on iTunes videos ranges from barely acceptable to atrocious—and that’s not going to fly when you're charging $14.99 for a movie. Start offering HD movies and TV shows, just as the Xbox Video Marketplace does; after all, HD movie trailers and podcasts are already on iTunes, and they work just fine on Apple TV. And if the iTunes store was accessible on the Apple TV box, the massive HD video files could download overnight—or even better, you could start watching the moment that there's an adequate video buffer.
3. Make a deal with NBC: Yeah, I know Steve, those greedy NBC execs made some tough demands and you stood up for lower prices (or at least, that's what your press release said). But I have news for you: without shows like "Heroes," "The Office," "Battlestar Galactica," "My Name is Earl," "30 Rock," and "Scrubs," the iTunes video store (and in turn, Apple TV) is looking a lot less appealing. And the last time I checked, all those shows are on Amazon Unbox for $1.99 an episode, the same sticker price they had before the iTunes blow-up. My advice? Swallow your pride, hike back to Rockefeller Plaza and find a way to get that contract renewed.
4. Movie rentals: Again, much discussed, widely rumored, and another good Falcone suggestion. All the other digital video competitors offer $3-to-$5 movie rentals, and let's face it: while I might pay $3 to rent "Mission to Mars," there's no way I'd pay $10 to own it. Also, word is that the big movie studios may be more likely to sign on with iTunes with a rental model, which could help solve another big iTunes/Apple TV problem: the pathetic film selection.
5. DRM-free videos: OK, so this one's kind of a stretch, and it's more of a long-term strategy than a quick fix. Still, if Sir Steve were to embrace DRM-free video as he did DRM-free music, he'd grab a boatload of Apple TV headlines and win back some goodwill for Apple in the bargain. As I've discussed before, there's no reason the DRM-free trend couldn’t work with video the same way that it does for music. Put a stake in the ground and declare that DRM-free video is good for the entire industry; if you lead, others may follow, and then make sure Apple TV works with everyone else's DRM-free video offerings.

Any other ideas for saving Apple TV? Or do you think it's dead in the water?

Related:
Is the Apple TV officially a flop? [CNET.com]
The iFlop [Forbes.com]