The new Apple TV allows users to order movie rentals (including HD movie rentals with 5.1 surround sound) or buy TV shows or music directly on the Apple TV. It can also view photos from Flickr or .Mac, play podcasts, and more. It will sync with a computer if one is available, but doesn't need to; it can operate as a completely standalone device. The software upgrade is free, and a new Apple TV is $229.
MacBook Air, "the world's thinnest notebook" is thinner at its widest end (.76") than the runner-up is at its most narrow end (.80"), and is only .16" at its narrow end, and yet it includes a full-size keyboard and 13.3" display. It is Apple's third notebook computer, and seems in some ways to be both the low-end (80GB hard disk, no optical drive or ethernet) and high-end (multi-touch trackpad, backlit keyboard, 5-hour battery) model, so they've placed it in the middle, at $1799.
Apple has been hurt by major music labels choosing to make unrestricted MP3s available through Amazon but not iTunes, despite — or perhaps due to — Apple's leadership in pushing for unrestricted MP3s. At least publicly, Apple is ignoring the issue and forging ahead with something even more impressive: getting all major movie studios on board. It remains to be seen how less restrictive time limits from Netflix might steal some of Apple's thunder, but Netflix doesn't seem to have more than a small fraction of Apple's mainstream credibility, so I suspect the majority of of people aren't going to know or care about the Netflix offering. The prices are very reasonable, and Apple's willingness to compromise by allowing more than one price for apparently arbitrary reasons (the age of a movie) may signal an interesting future when Apple resumes negotiations with music labels. In the meantime, I think Apple is going to rent a lot of movies.
The Apple TV improvements are what many people expected when it was first released, but delivering too late is better than delivering too little, and Apple appears to have delivered at least what people have been expecting. Movies, HD movies, songs, podcasts, photostreams, and YouTube all with or without a dedicated computer makes for a winning device, and $229 is important more as a symbol — a price cut — than as a target price point. At $229, again, Apple will be selling a lot of these.
The Time Capsule came first because it's the hardest sell. Those of us who have upgraded to Leopard and dismissed Time Machine because we use MacBooks and MacBook Pros know the value of Time Capsule, but that's a relatively small group of us, at least compared to the target audience of Apple TV, which is now everybody with a television in the United States. The only question for us is whether we would rather pay for a Time Capsule or instead rely on free software that tricks Time Machine into using any standard USB drive on a network. I already own an Airport Extreme and several terabytes of external disk, so I have to decide whether I'm willing to pay $300 for the approved Apple solution or download the free utility. I'm not sure how I'll decide.