My fundamental issue with iTV and iTV-like devices is that you still need to have a computer on in the other room. ... it just didn't seem right to have an entire computer on so that I can sit in front of the TV.
You're not crazy, Thank The Cheese, this is exactly right. This is another point that Apple are grappling with at the moment, and have been for the past ten years. Everything anybody has been saying about computers since the appearance of the fax-modem in the late eighties has been "wow, now I can use my computer to do x, but only if I leave it running. And I hate leaving my computer running just for a simple little task like that."
Thinking about it, I can name a hundred things that people would like to use their home computers for, if only it didn't mean leaving a noisy, humming power-draining box running 24/7. For instance:
* BitTorrent
* Answering Machine / Fax machine
* Videophone
* "Dashboard" style quick-access reference and calculation widgets.
* Personal file server / web server / media centre
* Downloading podcasts, etc.
So, on one side you've got all these great things you could use your computer for, and on the other the fact that it just isn't convenient to do it all the time because computers - even in this day and age - are still disruptive.
This is what Apple was talking about back in 1999 when Jobs was describing the "Media Hub" surrounded by more specialised devices. The iPod and iTunes is just a hint at where they are trying to get to. Airport Express was another step in that direction. And the iTV is the next step. Some other technologies also feature in this progression, such as Bonjour and XGrid.
What comes after this, though, is quieter, more specialised devices to act purely as "workhorse" computers that will not be disruptive AT ALL. We'll leave them behind the TV cabinet or under a desk, they'll have no fans and silent hard-drives, and no bright LEDs to disturb our sleep.
How we'll use these systems of the future will evolve as well. I'm very excited about e-ink displays. Now picture a home ten years from now with a couple of these "workhorse" systems in a kitchen cupboard holding all your movies, music and other media. Now picture yourself reading yourself to sleep at night with the latest novel from your favourite author on a tiny, 4mm thick e-ink device with wi-fi capability. And then, in the morning, you pick it up and the morning newspaper is already there, downloaded by the workhorse computers in the depth of the night, and sent by wi-fi or bluetooth to your e-Ink reader. You read the paper over breakfast, then get dressed and cleaned up and climb into your car, which has retrieved some music overnight by syncing with your iTunes library. As you start up, it checks the traffic reports courtesy of your home network and will warn you of any potential worries.
Perhaps we'd do well to ask why the iPod has been such a runaway success. Lots of competitors were out there. Sony seemed to be putting out a new technology every year throughout the nineties: DAT tape, Minidisc, NetMD - and none of them hit. The reason wasn't because the technology was inadequate, it was because none of these new technologies was being applied in a way that allowed new, smarter ways of doing things. The iPod and iTunes were designed to change the way people actually used their media, and as a result it was a hit.
Does anyone else remember Apple's "Knowledge Navigator" video from 1985ish? The one thing that sticks out in that video for me now isn't the human-language interface - its the fact that at the end of it, when the man says "Oh well, I'm off to lecture the next class" he leaves this brilliant, helpful device sitting on his desk rather than taking it with him. Nowadays, thats hard to believe. But in 1985, we still didn't really have laptops or cellphones, so we hadn't even started to think like that.
I think we're still at one of those embryonic stages - we're looking at a technology that is emerging and we aren't quite seeing yet what it will lead to. When we bag out the iTV and say "come on, who would want something like that?" we sound just like those guys who, in 1980, said "What would ordinary people want with a computer?", or in 2001 said "This iPod thing is just a gimmicky, over-priced device and we already have the Creative Nomad". At least Apple seems to be the only IT company out there willing to take steps forward, again and again, to explore how we use technology.