iTunes As Digital Hub: AppleTV’s Fatal Flaw.

The Mac is no longer the center of Apple’s digital hub strategy. Important, yes. Center, no.

iTunes and QuickTime are more important as the center of the digital hub. What of AppleTV? Apple is crippling our media future with a few fatal flaws.

Apple blew away Q1 2007 financial estimates with staggering sales and profit numbers. Again. Apple can do no wrong. Right? Wrong.

With AppleTV, Mac OS X Leopard, iLife and iWork ‘07, and iPhone on the way, what’s not to like, right?

What I don’t like is what was made clear in one statement during the conference call. Either CFO Peter Oppenheimer or VP Tim Cook said, “AppleTV is the DVD player for the 21st century.”

That’s a heady statement for a product that isn’t even available yet. Yet, it makes sense, and I agree that it’s possible—except for all those fatal flaws.

Here’s how it all comes together with iTV, uh, AppleTV.

We love iTunes, we love our Macs and iPods, but we don’t want to watch TV shows or movies, or listen to music on our Macs or PCs. That’s what the living room, sofa, stereo and television are for, right?

AppleTV lets our Macs and PCs, via iTunes and QuickTime, collect, store, manage our digital media whatever it may be.

Movies, TV shows, music, digital photos, slide shows, home movies.

Manage media on the Mac or PC with iTunes. Watch or listen to our media on the TV or stereo system in the living room the way God intended.

That makes AppleTV one very cool product. As Apple says, it’s “the DVD player for the 21st century” because it plays everything. AppleTV syncs with iTunes on our master Mac or PC.

It also allows streaming media from other Macs or PCs. See how that works? Isn’t it great? From now on all we need to do is get all our media from the iTunes Store.

Music, movies, TV shows, music videos. 99-cents here, $1.99 there, $9.99 over there. The new digital hub ecosystem from Apple—iTunes, iTunes Store, AppleTV—does it all for us. Including deplete our hard earned funds in record time.

In a perfect world, we’d all be perfectly happy with Apple’s perfect strategy. Perfect, except for a few fatal flaws here and there.

In a nutshell, the flaws include, but are not limited to the following: there’s no way to record, store, manage live TV, as in TiVo or DVR (digital video recorder). The quality is lower than current technology already provides.

AppleTV and iTunes doe not provide an easy, simple, elegant, Mac-like way to record live TV and store it in iTunes. There are solutions, such as Elgato’s EyeTV, but the whole process is cumbersome at best.

Media stored in iTunes and delivered to the TV or stereo system is lower in quality than current technology—the CD player, the DVD player.

If Apple truly envisions AppleTV as “the DVD player for the 21st century” then both fatal flaws must be fixed. They won’t be, and AppleTV and iTunes will languish as the Digital Duo that woulda, coulda, shoulda, but didn’t.

Why? No TV tuner or ability to record live TV shows ala TiVo and get them into iTunes for media management. Why not? Would content providers prefer we record the latest episode of “24” or American Idol or spend $1.99 to download from Apple?

Content providers don’t want digital downloads to compete with the quality of their precious and copy protected DVDs, and future high quality DVDs via Bleh-ray or HD-DVD.

If Mac and Windows PC users go the AppleTV and iTunes route to manage media, the solution will be incomplete and the quality will be lower than the current technology.

So, again, why should we buy AppleTV?