Apple TV To Be Renamed iTV & Stick To 720p

It looks as if Apple will update its Apple TV device fairly soon and will not only make it way cheaper but also significantly change the very fabric of the gadget.

Engadget reports that the Apple TV, soon to be renamed iTV (ed : expect some legal issues with ITV), will cost a mere $99 and come with the internal characteristics of an iPhone 4.

Indeed, Apple will apparently swap the x86 components inside the set top box for an ARM-only platform with 16GB flash storage.

However, the downside will be that the iTV will be limited to 720p content. Since the 3GS could play full HD video and the A4 on the iTV is unlikely to be underclocked, there must be something else preventing Apple from pushing 1080p content on the STB.

Engadget also says that the desktop equivalent of the iPhone 4 (without the screen & 3G component) will get apps and an App store. Maybe this explains why Apple is limiting its output to 720p; as it stands most apps would look awful at 1920x1080.

It is likely that the arrival of Google TV has convinced Apple to look at the iTV again and turn it into something radically different, capable of competing with the device both in terms of features and price.

Would you buy a $99 Apple iTV set top box even if it is not 1080p compatible? Do you already own an Apple TV? How can Apple improve the device?