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Something remarkable happened in San Francisco in January. No, not the launch of the MacBook Air, lovely though it is. And not the announcement of Time Capsule or even the revelation that, against all expectations, Apple had managed to sign every major studio up for its new video rental service.

No, the remarkable event came in the middle of Steve Jobs' keynote speech, just as he was about to announce the new version of Apple TV. Jobs admitted that Apple had got it wrong. Sure he camouflaged the admission pretty well by naming a whole bunch of other companies who also got it wrong, but it was an admission of failure nonetheless. Jobs told us that consumers hadn't wanted the product that Apple came up with when it made its first foray into the living room. In particular, the market had rejected the fact that Apple TV had to be connected to a Mac or PC to acquire content. It took a year for Apple to admit something that most reviews had picked up immediately, but at least it got there in the end.

The company's solution is to enable the Apple TV to connect to the iTunes Store directly, and to allow it to view content on YouTube and Flickr. At last it has a settop box with the potential to dominate the space where Microsoft, Sony and others have so far failed; the interface between our TV sets and the Internet. Virgin Media, BT, and Sky have all made a better fist of it than consumer electronics manufacturers, largely because they have control

Apple TV is well on its way to delivering the first part. In a year or so, the UK iTunes Store will have hundreds, if not thousands, of movies available for rent. That's a major step in the right direction. But it is only one step. The next one was alluded to by Ashley Highfield, director of the BBC's Future Media and Technology Unit, who wrote on the BBC's Internet blog that: 'This [the launch of the new Apple TV], coupled with Apple's (long anticipated) move to a rental model, means that the we can look to getting BBC iPlayer onto this platform too, as we should be able to use the rental functionality to allow our programmes to be downloaded, free, but retained for a time window, and then erased, as our rightsholders currently insist.'

The ability to access BBC iPlayer on Apple TV would be huge. It would put Apple TV on a par with on-demand services from Virgin, Sky and BT and when you consider the ability to view content from a computer on a local network, as well as easily watch video podcasts and YouTube, take it way ahead of those companies' offerings overall.

While Microsoft and its partners persevere with what is, essentially, a full-blown PC inside a living room appliance-type box, running Windows Media Center, and prone to all the bugs, crashes, and malware that goes with it, Apple now has a sleek, trim box that has numerous benefits over Media Center. It runs Mac OS X, so isn't as exposed to the possibility of downloading something nasty from the Internet. It has a fantastic, superbly designed, and easy-to-use interface. It also consumes significantly less power than a Media Center PC and is much quieter; important considerations in the living room.