Apple Updates Apple TV Software, Won't Help Sales (AAPL)

Apple (AAPL) has issued a software update for its Apple TV set-top boxes. This is a fine, if small, update and should make the gadget more useful for people who already own one. But it won't attract new buyers this Christmas.

Specifically, Apple added the ability to stream music over your home network via "AirTunes," the wireless music feature built into some of its wi-fi base stations; support for third-party remote controls; playlists; and music volume control.

As we said, a fine, incremental feature update. But not what Apple TV needs to take off. We think that Apple still ought to:

Open Apple TV's software up a little so it plays Internet video, not just iTunes video. We'd like to be able to watch Hulu, NBC.com, CBC.com, Major League Baseball, Netflix (NFLX), etc., videos via Apple TV. The easiest way would be to add an Apple TV-flavored Safari Web browser with Ad