Not the point. Apple aren't in a position strong enough to force upgrades to national telecom infrastructures.
I didn't say they were. If they roll out another little 1080p capable box- like Roku, Boxee, and many others- they just become contributors to the ever-growing demand for a faster, wider Internet. Again, whether Apple does or does not, that faster Internet- that greater bandwidth- will come anyway. That's progress. For this little piece of that, Apple can give it to other players or try to take a bit of it themselves. For a couple of years now, I can stream 1080p via Vudu.com in an app built into my Samsung HDTV. The demand for greater bandwidth exists with or without this ONE thing from Apple. Either way, average bandwidth must expand.
Does it expand first and then things that use the added bandwidth show up? No, stuff like bandwidth expands when demand threatens or causes problem. Do you really think AT&T, Verizon & Sprint want to spend the money to build out 4G? No, they would rather keep all that expense on their profit lines. But the pressure for more, more, more forces them to work (to spend money now) on the problem. This is the same. And it's not Apple being solely the force behind the pressure but just one of many variables asking for a bit more from the Internet.
Does Apple want to make the wise decision to wait until all that broadband everywhere is up to snuff for such stuff? No. Look at iCloud and the concepts people have of streaming everything. Apple is putting it's little bit of pressure on the bandwidth builders with iCloud. Lots of other companies are adding their pressure too. Solving that problem is what will get it done.
If the advertise 1080 but the majority of users can't access that, then there would be a massive outcry from the press of apple not delivering what they 'promise'.
Is that what happened when Apple went from 4:3 iPod formatted video to SD video in iTunes years ago (when bandwidth was even less)? How about when they went from offering SD widescreen to 720p a few years ago?
Apple don't offer a two tier service, the majority of their customers would not be happy accepting a second rate service.
Not sure I understand this one. If by "two-tier" you mean the choice of 1080p vs. 720p options, Apple already has two tiers: 720p vs. SD options. And even there, someone with dial up who struggles downloading an SD file could still opt for the (current best (from Apple) of 720p) file and just wait out the lengthier download. To each his own. It's not Apple's fault that someone's bandwidth in one place is much less than someone else's somewhere else. If Apple has to play to lowest common denominator, they should remove all video from iTunes as there are some people with less than 56K dial up.
720 is pushing it for many people on domestic broadband. This is the limit of current technology for the majority. If this is to become a successful product, it has to appeal to the majority market, not a niche.
The train has left the station. Almost all other devices in the marketplace are already 1080p. Almost all HDTVs you can buy are 1080p. People are sold- right or wrong- on a concept of "Full HD" at 1080p vs. barely "HD" at 720p. Compete with the evolving standard or let people who pay up for the modern standards buy other options. Apple just embraced 1080p themselves with iPhones that can shoot 1080p. If they still felt 720p is good enough, why would they do that?
Besides, the "domestic bandwidth" problem is outside of Apple's control. They can't solve that problem themselves. They are not the keepers of those pipes. If their solution is really to cling to 720p and let others sell the 1080p crowd, then the bandwidth you’re concerned about will get hogged up anyway by those other solutions moving 1080p video across the Internet. And guess what? It's the same Internet through which 720p and SD flows too. So if this really is a big domestic bandwidth issue, it comes along with or without Apple launching an

TV. And if the reason to stick with 720p & SD is to deliver a great experience for average (bandwidth) users, the bandwidth that somewhat works now is going to get swallowed up anyway as others eat it with bigger streams of stuff like 1080p.
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This gets me thinking; could Apple ever come up with a successful video game console for the living room? Hmmmmm...
Some people think that this is exactly that. An app store would bring it: iOS-quality games on the big screen. The challenges to the concept is more about the controllers for which, NO, iDevices will not be great controllers for all kinds of games (because you need to feel the buttons while watching the action on the big screen).
But some foresee bluetooth controllers or even, maybe (hopefully) a normalized USB port(s) which could then open the door to app store apps that are a combination of hardware & software. Not only would that make all kinds of gaming controller attachments readily possible, but it would also open up the potential for other niche functionality such as- say- Elgato bringing their DVR hardware+software to the

TV. There's a segment that definitely want this one little box to also be a DVR. There's another segment that would like this little box to also double as a BD player too. Some form of hardware expansion flexibility (like normalized USB) and an app store could bring that to market. Those kinds of things wouldn't be forced on everyone; but those that want that stuff would have a wait to get it.
One of the big attractions to the app store concept is the opportunity for others to do what Apple doesn’t seem to want to do (or maybe can't do in exchange for having content deals with Studios). Or maybe Apple really does see it as a hobby, so an app store might let those that feel more passionate about it's potential bring out some of that added potential.
Look no further than the jailbreaking crowd who work so hard to squeeze a little more out of it in unendorsed ways. Just think what could happen with a real app store.
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It's 1080p but the bit rate isn't that high. It will look just fine via the apple tv
What is the bit rate for iPhone 4S 1080p video? And how do you know that?