Apple has released the software update for the Apple TV that was announced at MacWorld 2008. It offers new features like an improved interface, video rentals direct from the iTunes store, podcasting, and the ability to browse photos from Flickr and .Mac.
I just realized, though, that the update that would actually get me to buy the Apple TV is missing: some sort of real use for that USB port on the back of the device. While many would like it to support an external hard drive (and some have had success doing so with some hacking), that's not the feature that I'd like to see.
What I'd like on the Apple TV is something that I do with my Mac on a daily basis - watch and listen to the media that's stored on my iPhone. I keep my iTunes library at home and sync my music and movies to my iPhone. When I'm at work I plug my iPhone into my work machine and I'm able (since I manually manage my music) to access that media on my computer. Since the Apple TV is essentially a "Mac lite," and can already access iTunes files (and iTunes DRM as well), the problem certainly isn't incompatible media formats or an inability to read the iPod. It seems that the only real limitation here is one of interface. That seems like a fairly small limitation.
There are two other possible limitations, of course. The first is that it's such a "niche" feature that Apple doesn't want to waste resources enabling it. This seems unlikely to me, though, as it would be awfully convenient for my buddy to bring over his iPod or iPhone and we could watch a movie stored on it (granted, of course, that it may not be as high a resolution as we'd like) -- it seems like the sort of thing that wouldn't be that difficult to do and that Apple would happily tout as a feature. The second is that Apple is choosing not to develop this feature either to help Mac sales or because of pressure from music and movie industry execs.
You know what would be even nicer? The ability to transfer a rented movie from the AppleTV to an iPhone.