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Apple's iTV Intriguing but Not a Core Business

And then there's the threat from companies that are already delivering video to the living room, namely the satellite and cable companies. Those companies are already dabbling with portable media devices and have consistently upgraded their set-top boxes with more and more features.

"The primary source of video viewing is going to be pay-TV as far out as the eye can see," says Danielle Levitas, an analyst with market research firm IDC. "It's not as if those [companies] are going to sit still not do anything."

Those kinds of challenges convince even those who are bullish about iTV and Apple's movie store that Apple won't be a core part of the consumer's living rooms anytime soon.

Apple's efforts "will go a long way toward helping Apple consolidate its hold on the entertainment space," Van Baker says, asking, "Is there going be huge market for it tomorrow?

"No."
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