Because encoding Xvid or X.264 wont kill your cpu, like H.264 does. What happends in two years when theres a new much better codec, that Apple don't like to much. Do you have to buy something new?
Apple's market shouldn't be only people who want to buy iTS Movies. Anyone who wants to play their movies from their computer onto their FlatTV should be the market for something like TV. The H.264 percentage of downloaded movies cant be much more than 0,5%. It's all about Xvid! It's fast and there's almost as good as H.264.
I really don't think TV is going to be a «hit».
Being able to decode Xvid at least would be nice, seeing as it is a no-cost option for DivX compatibility. I've watched a few legitimate bittorrents from a site hosting old out-of-copyright movies, old sci-fis etc, on my DVD player with DivX playback. Seeing as it has a version of OSX, it should be a simple software update. And seeing it can connect to the internet, the system could easily be updated automatically.
The 720p resolution restriction, less for MPEG-2, has to do with with Wi-Fi bandwidth limits, though if the hardware is capable, I think synced content should be able to play full 1080i, be it XviD or Ogg Theora. Maybe that chip is more expensive?
Having said that, H264 is the future, being the standard for all HD formats like HD-DVD and Blu-Ray. It is not an Apple standard, they are just the first to widely adopt it. It is
FAR superior to DivX in a number of ways, technical and quality-wise. Its incredible compression rate at higher quality is its main selling point over the old MPEG standard, and you will soon see it everywhere, much to the consternation of Microsoft, who is trying to push WM9 (and yes, it too is in the HD-DVD/Blu-Ray specs). As for X264, that is an opensource encoder of H264,
NOT a separate format! H264 and AAC, which Apple has standardised on, are the next-gen standards from the MPEG group replacing the old MPEG-2 and MP3 standards, are NOT going away anytime soon, and being an international standard, is cross-platform. Even Linux people can play it legally. Its one downside is the computing power needed to decode (and encode) it. Which hardware encoder/decoders in things like the Apple TV takes care of. Possibly every Mac may come with an encoder/decoder chip as standard. On my 1Ghz PC, VNC player does a good job too, better than Quicktime (incidentally, VNC uses the X264 library).
Of course, it would be nice if the labels and studios would allow Apple to sell non-DRM content as Steve urged them in his open letter, but I doubt they'll listen. Last thing we need is Apple bowing to their demands and produce something as DRM-crippled as Vista where only "trusted" applications can run "trusted" content, such as HD-DVD, through "trusted" hardware.
People use DivX because it is far more compact and modern than the aging MPEG-2 format of the DVDs they rip. Once HD-DVD/Blu-Ray starts to replace DVD, people will rip HD content straight to H264/AAC, which means no re-encoding or cross-encoding and resultant loss of quality. People might only use DivX/XviD if they want lower-resolution rips, and hence have to re-encode anyway.
TV appear to be, at least in part, a vehicle for Apple to sell movies via iTunes.
