We use a lot of Apple products in our house, iPods, iphones, iPad & most recently the Air. So I'm curious about the Apple TV. Does it just stream any shows, itunes, movies that you purchase off of itunes to your TV as well as your photos? And I believe it's compatible with Netflix, right? So if you have a Netflix account, you can rent stuff online and watch it on your TV?
We stream Netflix through our Apple TV so you can rent right from your screen. My iphone photos are the current screensaver on it, you can also play any videos you've shot from your phone. We also rent movies through itunes all the time. It has definitely come in handy with my son as well, I'm not a huge fan of a lot of kids tv shows but the few I do like I just stream for him from Netflix.
We rarely use ours but there's not a monthly fee or anything; you just buy the setup and you're done. It's in our main living room so we do use the Apple TV Radio channels to play music (similar to Pandora) and the Netflix connection. But we can also use our Wii for Netflix so that's not really critical. We've never purchased a movie or anything through it--they don't have any free shows, at least not that I've found. Everything is purchased through itunes so you can access anything in your itunes account--music, pix, etc.
we just got apple tv, so i am still learning how to use it. if you have mountain lion, you can do mirroring from your computer, such that anything that is streamed (or seen) on your computer, you can see on your tv. we don't have cable (i rarely watch tv), but i do LOVE the food network, and now i can stream episodes and watch them on tv - all for free you can also download a remote to your iphone, so that your iphone can control the apple tv. you can def stream anything from your itunes and also your photos. it is pretty cool!
We plan to get it when our Xbox Live subscription runs out. We canceled our cable and only watch shows on Netflix, but we're frustrated with the long waits for new seasons on some shows (Mad Men!). On Apple TV, you can buy the show's season and then see episodes as they air on the networks. You can also buy shows individually if you'd rather.
If we want to keep Netflix (and we might, and just reduce the # of discs) you can stream for free on Apple TV. We have to buy the Xbox Live subscription to stream Netflix now, and they hiked that up to $65 this year.