it also needs to be coded into the app.
some apps work already (Netflix, appleTV+, showtime, HBO max) some don't (Disney+, Plex)
if the app uses apple's media player, then it should work. If the app wrote their own player, then the developers will need to add code to make it work right.
Until the devs add code for the new wheel, the app thinks it's seeing position info from the old style regular touch surface, so it behaves exactly the same as if you finger was moving in a circle on the old remote.
when playback is paused, and you touch the wheel for a moment before you move, the current position indicator will change to a "donut with a dot on it." if you see that, it's going to work like you want it too. The dot will also match and follow your finger position on the wheel .
It may look like an iPod Click Wheel, and should function like a click wheel, this is just a circular trackpad surrounding a circle trackpad.
Bottom line is that this is more of a change of shape than a change of function. (And thats a shame because Apple revolutionized the industry with a clickwheel so this implementation just feels lazy).
it does work exactly like the iPod click wheel, some people just haven't coded their apps for the new hardware yet. .
with the exception of the very first model that had a wheel that actually moved, the iPod click wheel was just a touch surface with buttons underneath. There were also a couple versions of "touch wheel" that had buttons outside of the touch surface.
But, the new remote is just that, a touch surface with buttons underneath, but the touch surface is split into 2 parts.