FURTHER, would it not make perfect sense to have the

TV built in with a DVR, thus eliminating the cable box altogether. Assuming your HDTV has a Cable Card slot, you wouldn't need a Cable Box unless you're using it's digital video recording capabilities. If the

TV had that, then you would only need the

TV and a good AVR next to your television, thus eliminating all that extra equipment. Again, simplicity right?
Think different.
Think different(ly)... indeed...
Now, tell me again why I want a DVR if I can get on-demand content a-la carte without paying for 900 channels of BS out of which I maybe watch 2-3 programs a day, if that?
DVR's have very low market penetration for several reasons. One of these is the atrocious user interface of most DVR's. Say what you will about technological illiteracy but I'm a techno-junkie and frankly I find the design of most DVR UI's ergonomically inept.
Again... I'll say this: If I can buy whatever content I want, and leave the rest, why do I need a DVR? Now think about this carefully... because it's a loaded question...
Some will respond that they want to be able to catch the programming on their cable subscription.
Yet others will argue that they like the ability to record multiple programs off the subscription service for which they're paying a sizable fee.
Even still, others will rationalize that they don't want to ditch cable/dish because there's a wide range of programming across which they can surf.
If I can order the programs I want, watch them when I want, and store and access them on a system more powerful than any DVR in existence, a system that most consumers already have in their homes (it's called a computer)... why do I even need cable/dish?
The problem here should be obvious... people are trying to find reasons to rationalize a bad business model upon which they've become hopelessly (and mindlessly, some might argue) dependent without realizing they can throw out the baby AND the bathwater in this case.
The DVR is really a band-aid solution by the industry to try to fill the demand for what it is market surveys show that consumers really want... Instant access to programming of their choice. The interesting thing about the DVR is that it's the industry's way of trying to put a band aid over your eyes... in the hopes that maybe, just maybe, you won't come to the glaringly obvious realization that you don't need to subscribe to 900 channels of crap.
And the DVR is failing because consumers, as dumb as they can be, do not live in a vacuum.
The big difference between AppleTV and previous efforts to launch solutions that bridge the average consumers existing computer network seamlessly with their living room isn't just the ease of set up/installation, or the user interface... It's the fact that Apple really believes in this product.
I have been waiting for tomorrow for at least ten years since I first wrote a research paper on the future of internet distribution of audio and video content. Apple understands that this is a huge revolution and they're treating it like one.
When the Media Center PC was launched... I don't remember much hype at all about it. It was sort of a "me too" add-on thrown out there to say "yeah you want to do this... ok" *slap-tape-nail-drill* "Here."
Apple has done their homework and timed the introduction of AppleTV so perfectly it would almost be absolute genius how they predicted the timing of technological convergence... that is, if they weren't the ones largely responsible for driving it.
Step by step Apple has been taking the hub strategy to heart... Instead of a "me too" product they've been driving the standardization of almost every essential component of technological convergence. To wit, here's a list of products they either invented and/or first made standard and where they fit in the historical evolution of the hub strategy that Apple themselves didn't seem to understsand until Steve Jobs came back, wrangled it in and gave a sense of direction:
0. Quicktime - 16-bit audio and 8-bit video support
1. Ethernet - facilitates network communication with the hub
2. CD-ROM - multimedia input/output
3. Newton - Flirtation with disaster? or Flirtation with appliances?
4. Firewire - audio/video/image
5. USB - audio/video/image
6. iMac - reintroducing consumers to the idiot-proof all-in-one
7. iTunes - Music
8. iPhoto - Images
9. iMovie - Movies
10. iDVD - Videos
11. iPod - Take 7 through 10 with you!
12. iPhone - 11 + some of 6 + wi-fi = Insane greatness to-go (now with multitouch!)
13. AppleTV - Harnesses 0, 1, 7-10
14. Mobile Mac - Take all of the above anywhere
This list may be missing a few things (e.g. core audio, core image, etc. ) but, really, need I say more?