Apple, the creator of the world’s most successful digital media player so far, has announced that it had begun shipments of its Apple TV, a device that can bring Apple’s products to the living rooms. But the success is uncertain, as the new set-top-box not only cannot match the video quality of HDTV, but offers quality lower than even DVD does.

Apple TV has an Intel microprocessor and a 40GB hard drive to process and store content, including movies, videos or photos locally and is compatible with Wi-Fi 802.11 b, g and draft-n standards. The set-top-box comes with HDMI, component video, analog and optical audio ports, but despite of the fact that HDMI supports up to 1080p (1920x1080 progressive scan) resolutions, Apple declares only up to 720p (1280x720 progressive scan) resolution for its Apple TV device.

Videos, which can currently be purchased from the iTunes 7 store, are downloaded in below-DVD quality (720x480 [NTSC] or 720x576 [PAL] resolution with Dolby Digital audio) at a resolution of 640x480 (up to 480, depending on the aspect ratio) and currently can be played on computers and iPods. With the Apple TV device consumers will be able to watch the movies on their TV-sets as well. The question is whether 640x480 resolution in the age of HDTV can actually be in demand.

Microsoft’s Xbox Marketplace store offers a variety of standard definition (SD, about $4 per movie) and high definition (HD, about $6 per movie) movies as well as SD (about $2 per episode) and HD (about $3 per episode) TV shows, whereas Apple’s iTunes offers below-DVD quality movies for $9.99 – $14.99 and similar quality TV-shows for $1.99. Consumer electronics companies, such as Sony, Panasonic or Toshiba, are now pushing high definition videos with crisp 1920x1080 pixels resolution and DTS or Dolby Digital Plus audio very hard and unless Apple increases resolution of movies sold through iTunes, the destiny of the Apple TV seems uncertain.

Apple TV, which includes the Apple Remote, is available through Apple online store, Apple’s retail stores and Apple authorized resellers for a suggested retail price of $299.