Apple TV moving into the cloud

Steve Jobs says that he sees Apple TV as a hobby for the company, but the rumour mill is spinning faster every day as tech news outlets try to outguess each other over the Cupertino company's next move into the living room.

No doubt spurred by the imminent arrival of Google TV, Jobs and his Apple minions are supposedly gearing up to have another stab at getting an Apple device hooked up to your TV. As we all know, Apple TV was purchased in reasonable numbers by hard-core Macolytes but failed to gain the kind of traction among the unconverted that Apple needed to see the diminutive media player becoming as ubiquitous as the iPhone or the iPod.

Apple TV has been very much on the back burner for a couple of years now, but recently the rumours have started to ramp up again. A month or so ago everyone was convinced that Jobs would announce the arrival of a new Apple TV product priced at a remarkable $99, which would probably stream video media direct from cloud-based servers rather than relying on local storage.

The latest mutterings, fuelled by the usual 'anonymous sources' indicate that the next generation of Apple TV will use flash memory to buffer incoming video streams, and will have no on-board storage at all, which could certainly help when it comes to keeping the price down.

According to NewTeeVee, Apple is currently negotiating with TV producers to get individual hit shows onto the service at a rental price of 99 cents US. Hit TV shows like House can currently be rented from iTunes for $1.99 or $2.99 for the HD version.

Rented shows can be viewed anything up to 30 days from the date of purchase, but once you start watching it you have to finish within 24 hours. Apple is expected to go after high-quality cable output which isn't currently available on subscription services like Hulu.

For once, the rumours actually add up and make a lot of sense for Apple. With just about every electronic device on the planet able to stream video in one form or another, unless Apple gets a low-price device onto the market it will miss out on what could be the biggest gold rush of the 21st century. The company has the wherewithal and the software expertise to turn Apple TV into the next iTunes, but only the most dedicated of Macheads will be willing to shell out £650 for the cheapest Mac Mini available just to be able to watch a few episodes of True Blood.

On the other hand, if Apple can get a beautifully-designed, cloud-based rethink of Apple TV - running the excellent Front Row interface, and with shows priced at a point where people don't really have to think twice about punching in the password - onto the market for less than a hundred quid, we reckon it might have a winner on its hands.