For awhile we've been of an opinion that, as you allude in your final paragraph, that the Apple TV was there to, if you will, prepare a path.

The Apple TV created a larger ecosystem for video content. Thus helping to keep the video content owners on board and cooperative. Thereby ensuring that the iPad would have a rich selection of video content upon its eventual arrival.

But even more, the Apple TV helped educate the consumer base about the benefits of a “home content server”. While somewhat limited in scope, one could stream content from the Apple TV to other locations. And the Apple TV wasn't a computer. It could easily be argued that this was a step in convincing consumers of the viability of a device with more limited storage, one that was, and I hate to use this term, more “cloud-based”. Thereby putting the “net” back in “netbook”.

The iPad is very nearly optimized for remote storage of content, with a small concession to local storage space. The Apple TV, the computer with file sharing or iPhoto sharing or iTunes sharing enabled, perhaps even a Time Capsule or an Airport with a hard drive — all provide “nearly local” net services. One imagines that Mobile Me (and Google Docs — although with less integration considering the increasing coopetition) will see further integration. And that iTunes “streaming” of known to be owned content might not be far down the road.

Anyway, long version short, the Apple TV isn't a failure because its major role isn't to be a standalone device, but to be part of the Apple ecosystem to support it's other offerings. If the right device came down the pike, I don't think Apple would care at all about losing a role in what is destined to be a hardware commodity market in the long-term anyway — so long as the devices enable the functionality that Apple desires to provide to its customers.

When friends and visitors ask me how I got my photos on the TV like that with the “really cool” transitions and music, I tell them the TV is like an iPod for your TV. They then get it immediately. “It syncs with iTunes, it plays music and video and it can do all of these *other* things as well.” TV==iPod for TV.

I'm seriously serious here : I didn't think of the synergy the ipad can bring to rental of tv show (“ho a new episode , okay I pay it, so simple”) and when the huge market will be there, “suddenly”, the apple tv will really be useful AND a mature product…

very astute.

I really hope that second act begins; I'll be among those who get the next rev.

If the ipad is a success and the next version of the AppleTV has a doc port for it, that might just be a path to success. If I was a doc maker for ipods my head would be spinning at the possiblities for making great ipad docs. An AppleTV that is also a Dock might be a powerful combination.

If you search the web, you'll find many complaints about users buying Tivo's and then having endless issues with the Cablecard not working and the cable company continuously replacing the cards to get it working.