I don't have a problem. I'm trying to have a discussion. What makes you think I'm hurt just because I disagree with you?
You seem fixated on just this one little piece (the rumored price), and continue to imply that it is virtually impossible.
You've dismissed ideas in this thread because they don't fit with the $99 price point with Apple margins. The hardware described doesn't even fit with a $99 price point unless it's subsidized or a loss leader (which Apple doesn't do) or at cost (which Apple came close to with the current AppleTV).
It wasn't good enough for me, because I actually looked at the price of the rumored components instead of using rumors as evidence. An A4 processor and 16Gb of Flash memory and you are already over $50 in materials
Perhaps we should clarify some math then? Some of your comments reads like "Apple margins" is some hard number, when in fact, they are merely a percentage of sales. Apple seems to like margins in the 30%-40% range. For the sake of this, let's dismiss the idea of trying to price this on the low end and cut it down the middle. That would be 35%. What does the case, chips, ports, etc have to cost to yield 35% margins at $99?
About $74. As you suggest, "an A4 processor and 16GB Flash memory" is already over $50. Can they add some standard ports, a case, and maybe a graphics coprocessor, remote, packaging, etc for the other $24? Could they do better than $50 on the A4 and memory buffer? For example, does it need 16GB if it is an all-streaming device?
Again, look to a device like the WD example. It is a set top box. It has a case and lots of ports. It has a 1080p chip set inside and a processor to run it. It comes in a package, with a remote. There's apparently enough profit in it for distributors and for WD, while Apple tends to act as a major distributor and source (taking both pieces of the profit on direct sales).
Here it is
retailing right now at a named distributor for $89.95:
http://www.bhphotovideo.com/c/produ...Digital_WDBABY0000NBK_NESN_WD_TV_LIVE_HD.html
...and I didn't even shop around much to find that price. If we assume some markup to give B&H some profit, and some profit for WD, $89.95 is not so far above $74.
Can Apple not put some chips in a case with some standard ports- much like WD is doing with this product- put that in a box so that the total unit cost comes in at $74? I would guess they can.
And $74 works with a margin of 35%. Why not be a bit more aggressive to try to make it to $99 if it comes in a bit above $74? Even if they trimmed their margin on this to the low end of their desired range, the dollars involved on millions of units sold would not have much of an effect on Apple's overall average margin.
Lastly (but probably unlikely), Apple could take the razor blade approach and wash out much of the margin on the hardware, with a goal to make up for it on the software sales. Lots of iTV's in the home will be a tempting vehicle through which to buy iTunes content on demand... and maybe this iTunes subscription program. On the other hand, price it too high (again) for the masses, don't sell many of them (again), allow other internet-connected devices to entrench in volume, and have a near ZERO chance of the owners of those other devices buying/renting their media via iTunes through the little boxes connected to their HDTVs.
First, no indication in your examples of "Apple margins." Second, neither of those devices is capable of running iOS or similar.
Since I'm not privy to the exact margins made on other devices, there's no way to nail this completely. However, the above takes a pretty good shot at using a current retail price to imply the potential. If we assume other companies make profits on sales of their products too, we can build some margin into that price, which then means the cost of the unit must be something south of that price. It's not a long way from that price to a $74 target.
How do you know that neither device is capable of running iOS? iOS is just software. Software can be made to run on almost any decent chip set. I'm 100% confident that since WD has a UI running on top of the hardware in that WD box, Apple could get their iOS UI running on top of that hardware... if they wanted to do so.
The A4 is not some special, super high cost chip. Apple is using it because it hits the right compromise between cost and what they want it to be able to do. If A4 came at too high a premium, the iDevices would be using something else (just like the previous generations of Apple iDevices)... and iOS would be running on that something else.
We don't need to pretend that the A4 is some vastly superior chip that requires a vastly superior cost and thus retail price, just to imply that $99 is impossible. If Apple wants to hit $99 with their margin, they just make iOS run on other hardware... if A4 or similar makes it such that the retail price will miss the target. iOS is not married to the A4; it can run on chips in iDevices before there was an A4.
No, but I don't think that better components would total one-third the price two years later.
I believe the tech is now at last 6 years old (or close to it); the

TV is almost 4 years old itself. I'd encourage you to go look up those parts, in volume, and see if this is true or false. Perhaps scarcity of old parts that nobody wants to use much anymore could make this prove out (like Space Shuttle tech weaker than Commodore 64s costing hundreds of thousands of dollars because NASA is the sole customer).
But again, looking at something like the WD live product, you have the hardware for 1080p in the box, retailing for less than $99. Apple UI is superior to WD UI, but that's just software.
Obviously, no, I don't think that is possible. Look at the iPhone 4 cost breakdown. Take out the screen and the stuff you don't need. Add in HDMI, component, stereo, and digital audio outputs. Gigabit ethernet. I don't see how it comes out to the $50-$60 range that would result in "Apple margins". Like I said, the A4 processor and 16Gb Flash memory total just over $52. WiFi is another $7.80.
If Apple follows the example they set with the first gen

TV, they won't use the latest & greatest tech in this iTV. The first gen hit when core duo were dominating, but there's no core duo in it (instead it uses some weaker- aka cheaper- Pentium chip- Pentium D I think). The first gen hit when there were lots of higher power graphics coprocessors, but they used a minimal (cheap) processor that was just enough to cover the desired specs. I believe there's only nominal ram in the first gen- just enough to buffer some video, but I recall it not being very much at all. Etc.
This iTV doesn't have to roar vs. iPhone 4... it just has to be "enough" to hit (hopefully) specs superior to the 2006 spec. I don't suspect they would start with a finished iPhone and start stripping it down. I suspect they would start with nothing and start building it up. In the end, my guess is the the iTV won't use iDevice apps already in the store, but probably have it's own apps. Why? Because how you interact with this device will likely be different than how you interact with all the other iDevices. It that proves out, it is even more distanced from the current iDevice cousins: no touch, no battery, no retina display, no memory above "just enough", no gyros, no 3G, no sim card, no docking port, etc.
I could also see them sold at $99 only with a subscription and more without.
On this, we can agree. I can see that too. I can also see it being possible to hit $99 without other obligations. But, I don't really care if it comes out at $99, or $199, or $299. Lately, I've been wishing they would just release the latest

TV UI as the new "Front Row" and I'd probably just pay up for a mini dedicated to this function. Yes, that's overkill for such a specific purpose, but I'm not really that hung up on price. I would like to see a 2010+ next-gen box capable of 1080p playback, and hopefully a bit more open (apps, maybe USB add-ons from third parties) than the

TV I have now.