Users of the second-generation Apple TV set-top device will now be able to view every TV show they have ever purchased from iTunes without connecting their computers. A software update available on Monday integrates the device with Apple's iCloud so the Apple TV can access content directly. Previously, Home Sharing or an Air Play connection was required.
Watch Your Own Videos
Apple TV watchers can also access content from the video-sharing site Vimeo, which specializes in user-made content, and download new TV shows directly from iTunes or replace shows deleted from other devices.
The update comes as web-based entertainment viewing is in a major state of flux, with Netflix and Blockbuster battling Wal-Mart for online rentals and numerous devices offering streaming to bridge the computer 
-TV set gap. Content owners are trying to assess whether they are better off with pay-TV operators such as cable and satellite or streaming services like Apple, Hulu or Netflix.
But can Apple dominate in this field as it has in the music, smartphone and tablet markets?
Michael Inouye, a digital-home analyst for ABI Research, sees the cloud link for Apple TV as a significant step.
"To some this might sound like a small change, but this step further enhances the cloud strategy -- namely iCloud, in this case -- and more tightly integrates the iTunes/Apple experience across devices," he said. "It sounds as if this update is limited to TV shows for the time being, but movie purchases might not be too far down the road."
Amazon.com, Microsoft, Netflix and Sony are also using the cloud approach in the U.S., while overseas there are HbbTV and YouView in Europe or acTVila in Japan as further evidence of the transition to digital distribution via download or streaming, Inouye said.
"So Apple is not really trailblazing any roads in this case, but ... could have a more substantial impact on the market as their content flows more freely across devices," the analyst noted.
The Wild Cards
Here's where things get murky.
"The most significant wild card is the content owners," Inouye said. "We have to remember that Apple does not command the same power in the video space as it does for music. Which means it is possible the content holders could put similar restrictions on Apple if the company were to offer a subscription service akin to Netflix."
He noted that Fox recently said it would hold back some content from download or streaming to give pay-TV operators an advantage.
While all this suggests that the DVD's days are numbered, a March poll of 200 Americans by ABI found that nearly three-quarters, or 73 percent, rent discs sometimes while 80 percent still buy them.
In addition to loyalty to physical media, another factor affecting streaming and downloading, and offering an advantage to pay-TV operators, is broadband, which in many cases is affected by data caps.
"HD content requires a large amount of bandwidth , even with bit rates far below Blu-ray, and as more consumers embrace these cloud-based technologies, the demand on the data pipes will grow in kind," Inouye said.
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