The Apple TV comes with connectors geared to HDTV and touts 720p output, but the content is not up to HDTV standards and is visibly poorer than Xbox, according to an AP story carried by NBC News.

"Too bad, then, that where looks really matter -- in the quality of the video on the TV screen -- the $299 Apple TV comes up very short. It’s as if Apple had launched an iPod that sounded like a cassette player," Peter Svensson wrote.

While the Apple TV is extremely easy to use and the menus look great, the author reported,"that videos from Apple’s online iTunes store look horrible on an HDTV set. The movies and TV shows have the same nominal resolution as DVDs, but look much blurrier, approaching the look of standard-definition broadcast TV."

These videos aren’t exactly cheap to purchase from iTunes. "Pirates of the Carribbean: Dead Man’s Chest" costs US$15, almost as much as the DVD.

In contrast, when the Xbox was tested, the video performance seemed much better. In the reviewer’s opinion, "After having my eyes gently caressed by the Apple TV’s menus, the Xbox interface is like a slap in the face. It’s garish and confusing, and you have to press more buttons to get where you want to go.

"But the Xbox does your HDTV justice. Microsoft’s Xbox Live marketplace has some movies in HD, and these look absolutely stunning -- better than most broadcast HD, and almost indistinguishable from HD DVD or Blu-ray discs, which provide the best video quality available to consumers right now.

"Even the standard-definition fare on Xbox Live looks much better than iTunes movies, despite nominally being the same resolution. They look almost as good as DVDs."

The bottom line was that neither solution was perfect. Even so, Mr. Svensson expressed dismay at the mismatch between the thousands of dollars spent on an HDTV and the quality of the Apple TV content: "Of course, Apple will at some point start selling HD video through iTunes. It has to. Will that play on the current Apple TV? Probably, but I’m wary of the result."