Apple TV: Time to Get Serious

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Hackers Open Up Apple TV

So how does Apple arrive at that flexibility? Consider what happened when Apple TV first hit the market. In a matter of days, enthusiasts cracked it open and hacked together a handful of unofficial applications to support scores of video formats that Apple had ignored. Sure, those willing to go to the technical trouble may have voided their warranty, but after a little work, they had vastly more flexible devices.

There are software hacks out there that give Apple TV owners access to such movie rental services as Jaman and HungryFlix. Other fixes let you rip the content of a DVD to the device's hard drive in much the same way you'd rip a CD to a computer.

The most promising of the hacks I've seen is one for a service called Boxee. Installed on your computer or Apple TV, Boxee gives you access to pretty much any kind of video available on the Internet—be it Hulu.com, Joost.com, CBS.com (CBS), or something else. The user base is limited since Boxee is still in an early testing phase, but I'm told even the testers are dropping cable or satellite TV connections entirely. Yes, using Boxee takes some technical acumen that's beyond abilities of the average user, but that doesn't have to remain the case.

Following the Lead of the iPhone

Clearly, there's pent-up demand among a core group of early-adopting consumers to push their extensive video collections out of their computers and to their TVs. There's also a desire among software developers to build interesting applications for Apple TV. Kind of like for the iPhone, where developers have cranked out some 15,000 applications—many of them free, others selling for $10 or less. In less than a year, iPhone owners have downloaded half a billion of these applications. These legions of creative developers have turned the iPhone into the most powerful threat to existing phone manufacturers like Nokia (NOK), Motorola (MOT), and Research In Motion (RIMM).

And that's how it could be with Apple TV. Apple should give programmers the software developers' kit they need to make the device more flexible and useful. Buy the box, and you can buy or rent from iTunes—and if that's not enough, there are hundreds of easy-to-install apps that will let you watch whatever you want from the Internet.

Meanwhile other Internet-to-TV boxes have come and gone. Akimbo, an early Internet video box maker, shut its doors last year. Netflix (NFLX) has teamed up with Roku on its own movie-rental box that has met with rave reviews, and the feature has been added to TiVo boxes and will soon be built directly into some TVs. Then there's the upstart Vudu, which makes its own rental device. And TiVo has teamed up with Amazon's video-on-demand service. The options are multiplying quickly, yet none have hit upon the magical formula that causes an iPod-like wave of consumer mania.

It's Up to Apple

That formula may be lurking inside the mind of an as yet unheard of software developer who's envisioned an application that will blow all our minds and make our TVs talk to the Internet in ways we can scarcely imagine. That person just needs a supportive partner to provide the hardware. There is no reason in my mind why that partner can't be Apple. It's time to get serious about this hobby.

Hesseldahl is a reporter for BusinessWeek.com.