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Update: Check out three related videos with more info on the forthcoming Apple TV upgrade: Steve Jobs comments during his keynote address; the video guided tour on Apple's Web site; and a summary from CNET's Donald Bell. This post has also been updated since its original publication with additional information.

The Apple TV just got a whole lot more useful.

Steve Jobs unveiled a major feature update to the Apple TV today during his Macworld keynote address in San Francisco that aims to transform the device from a TV-based iTunes media viewer to a more full-featured media-on-demand device. The hardware will remain the same, with the entry-level 40GB model dropping from $300 to $230, but a free software upgrade--available in two weeks--will add the following functionality:

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LAS VEGAS--A lot has happened since we first saw Sling Media's SlingCatcher set-top box at CES 2007. Two new Slingboxes have debuted, as well as a handful of product updates from the company. Oh, and of course, the company was purchased by EchoStar for $380 million.

Watch the SlingCatcher video on CNET TV.

But this is the year, the company insists, that the long-awaited product will indeed be on sale. No specific date has been set, but the word is sometime in the second quarter. Though it originally planned to have it out in time for holiday sales, "sometimes these things take time," said Sling CEO Blake Krikorian, in a statement.

The SlingCatcher is a separate set-top that can be used to bring content from a Slingbox to another TV in the house, or from an external hard drive. Though it works fine on both HDTVs and standard-definition sets, connecting the SlingCatcher to the new Slingbox Pro-HD is the only way to transmit high-definition video around the home.

The SlingCatcher also lets users project Web content to a TV screen, either wired or wirelessly, through an application called SlingProjector. Navigation can be done with either the included remote or through a PC.

SlingProjector software has been updated since last we saw it. When browsing Web video on a PC, the software automatically detects windows with video and projects it to the TV screen it is connected to.

Also updated: the official price of $249.

I spent last week in San Jose, Calif., at Cisco System's annual analyst event called C-Scape. Since it snowed twice while I was gone, Cisco could have said nothing and it would have been worth the trip, but John Chambers and Co. made sure to fill the two-and-a-half days with loads of content. Unlike past Cisco events, which could have been held in an MIT engineering lab, this one focused on stuff way above Layer 3 in the old OSI stack. Cisco believes it can continue healthy double-digit growth in the future by focusing on:

1. Phat content: Think Web 2.0 on steroids. "Collaboration" was probably the most popular word of the entire conference followed by others whiz-bang concepts like TelePresence and IPTV. Cisco believes we will see 40 percent-plus growth in Internet traffic through 2011. No longer content to sell pipes alone, Cisco will gladly help customers with new goodies for video conferencing and unified communications.

2. Solutions: Cisco wants to sell the whole communications enchilada. For example, when you buy TelePresence you get screens, microphones, chairs, and tables. Heck, I'm surprised that Cisco isn't including plants and window treatments! To Cisco, TelePresence is still small potatoes. The company is already building new infrastructure for developing countries. Look for Cisco to also work more closely with service providers on managed services in 2008.

3. Software: Software and especially management software, was always Cisco's Achilles' heel. The company reads this loud and clear so it reorganized its software group, purchased application-layer companies like Reactivity and Securent, and brought in a bunch of software heavy hitters. I think Cisco is thinking about a big upside in software moving forward.

4. Hedging its bets: Who cares which switching transport wins out, Cisco plays in Ethernet, Fibre Channel, and InfiniBand, and makes devices that can handle all three. Cisco's purchase of WiMax vendor Navini Networks is yet another example. Cisco wins regardless and can pick its spots to seek control of a market.

The industry used to pick on Cisco for areas of technical weakness or product gaps. Cisco seems to be circling its internal wagons in these areas and then placing bets on the next few communications megatrends. Yes, Cisco still competes with Extreme, F5, Juniper, and Hewlett-Packard but it really has its sights on IBM, Microsoft, and HP. This places the company in a very unique position.

There will certainly be bumps along the way but Cisco has its installed base, global reach, and deep pockets to fall back on. It's hard to see how the company won't grow with these strengths. One more thing about Cisco, it puts on a pretty good analyst event.

When we reviewed the Vudu back in September, we said "only feature films are available, but Vudu says that TV shows are on the roadmap." Vudu made good on that pledge today, adding 12 TV shows to its content roster. Episodes are available for $1.99 each--the same price you'd pay for TV shows on Apple's iTunes Store.

TV content on Vudu is said to be "in beta," but it should be available to all Vudu owners as of today. The initial dozen shows offered are: 24, Arrested Development, Buffy the Vampire Slayer, Family Guy, Firefly, Lost in Space, My Name is Earl, NYPD Blue, Prison Break, The Riches, Shark, and The Shield.

While all of the TV shows will be available in standard-definition, Vudu has been experimenting with HD programming as well. Today marks the availability of The Bourne Ultimatum on Vudu--the same day it hits DVD and HD DVD--in standard and high-definition versions. The previous two Bourne movies have been available for free viewing on Vudu in HD since November 23, and the company says that "more HD will be coming."

Update: For the record, The Bourne Ultimatum is available only to buy for now (as a permanent download to the Vudu box). Rental options may follow in the future on Vudu and other digital download providers.

Networking companies are beginning to deliver the new Vista-friendly Media Center Extenders that Microsoft outlined earlier this month. D-Link's entry in the race is the DSM-750. Like competing models, the DSM-750 attaches to a TV (standard or high-def) and streams live and recorded TV, video, music, and photos from networked Media Center PCs located elsewhere in the home. An update of the older DSM-520, the 2007 model adds dual-band 802.11n wireless (which has the speed and bandwidth for optimal streaming of HD video) as well as compatibility with the popular DivX and XviD video file formats. Unlike similarly equipped products from rival Linksys, however, the DSM-750 will also offer access to active-TV, a service that provides access to more than 200 "channels" of on-demand Internet video content, including free (ESPN, YouTube, AOL Video) and premium (CinemaNow, MovieLink) services. (Owners of the DSM-520 will also get active-TV access, thanks to a forthcoming free firmware upgrade.)

The wireless-N speeds and active-TV content are a nice step up for the D-Link streamer, but the DSM-750 will have its work cut out for it, thanks to a whopping $350 price tag. That's the same cost as a 20GB Xbox 360. The Microsoft game console doesn't have built-in wireless, but it, too, can double as a full-fledged HD Media Center Extender. And unlike the D-Link, it can also play games (Halo 3, anyone?), DVD movies, and HD video downloads from Xbox Live Marketplace. The D-Link will go head-to-head with the Xbox and Media Center Extenders from rival manufacturers when it goes on sale in November.

FOSTER CITY, Calif.--Some of Sling Media's peers and competitors applauded the company a day after word came that it had been acquired by EchoStar Commmunications for $380 million.

At the IPTV World conference here, attendees said they were happy to see a fellow Silicon Valley company striking pay dirt. Many of them also said they owned a Slingbox, the hardware that beams shows from a home TV to anywhere in the world an owner might be.

"This is an excellent outcome for the Sling Media guys who really executed well," said Ward Williams, vice president of marketing for iChip India, an IPTV start-up. "They did a good job of taking what is essentially a great feature and communicating to consumers why they needed the service. For the rest of us, deals like this are encouraging."

Internet Protocol Television (IPTV) describes the distribution of digital content to televisions over broadband networks. A score of companies are here showing off their wares and exchanging estimates on when mass adoption may finally arrive. Another reason for the sector to feel encouraged is that Sling Media's acquisition is a sign that big media firms may be eyeing the sector, according to Conleth O'Connell, chief technology officer for Vignette, which develops content-management software.

O'Connell recalled hearing News Corp. Chairman Rupert Murdoch say in a speech that the public has grown weary of information traveling down a one-way street. Murdoch said, according to O'Connell, that everything from video sharing to blogging indicates that consumers want some control over information.

"The Slingbox is inside a person's home but allows them to send their TV experience outward," O'Connell said. "We had all better listen to what consumers are telling us. They want this notion of sharing. In the future they'll want to send a favorite TV clip to a friend or community. In the past, the direction of information has gone one way: from broadcasters to viewers."

Buying an IPTV property may provide media companies with a way to help users become more interactive with content, but Henry Choy, a video and TV analyst with Jon Peddie Research, said Sling Media offers EchoStar a chance to branch into a mobile market without having to depend on others.

"EchoStar is a satellite company and they don't have the broad access that the telcos or cable guys do," Choy said. "This is clearly a way for EchoStar to appear in any device they want. They don't have to rely on AT&T or other carriers. If you have Slingbox you can see EchoStar programming anywhere you want. It moves EchoStar out of the home. "

Provided it works, cautions Choy.

He points out that the Slingbox is a beautiful way to distribute content when there's enough available bandwidth. He argues that anybody who owns a Slingbox knows what it's like to see grainy or choppy images due to an overtaxed network.

Choy predicts that as compression technology improves, bandwidth will be less of a concern. When that happens, it's going to be tough to compete with the Slingbox. While many IPTV companies are trying to combine traditional TV with Internet video, most of the Web's top video sites would love to offer premium TV shows.

"Rather than having to look for Web content," Choy said. "It's much more compelling to watch the exact same content that you have at home."

Editor's note: The original version of this blog incorrectly stated that AT&T is using the Sun Streaming System. The text has since been corrected.

Sun Microsystems said Wednesday that AT&T plans to use its Sun Fire servers and storage arrays to power its Internet Protocol television service, called U-Verse.

The deal is significant for Sun because it could be a foot in the door to eventually sell AT&T its new, advanced Sun Streaming System, which includes Sun Fire servers and other technology that can be used to stream 160,000 simultaneous IP video streams onto a network.

Sun created the Sun Streaming System to serve the emerging IPTV market. Phone companies around the world, such as AT&T, are using IP to deliver television service. And the Sun Streaming System, which can cost as much as $8 million, provides a scalable and cost-effective way to deliver video-on-demand services to thousands of homes. A deal with AT&T, the largest phone company in the United States, would be a huge validation of the technology.

It would also be a big endorsement for Andy Bechtolsheim, the Sun co-founder who led the design of this new server technology. Bechtolsheim rejoined Sun in 2004 when it acquired his start-up, Kealia, which was basing its business on the Internet-video product.

But so far, Sun is keeping mum about whether or not AT&T is testing the new system.

"Sun can't comment on whether or not AT&T is currently evaluating the Sun Streaming System," a spokeswoman said. "But this deployment definitely provides a great opportunity for working with them in the future.

CHICAGO--Verizon's CTO Mark Wegleitner addressed a room full of reporters here Monday night on the eve of the NXTComm telecom tradeshow. During his brief talk, which followed a heavy meal of porterhouse steaks and veal chops at the famed Gibson's Steakhouse, he gave a glimpse into some new features and functionality that will soon be coming to the company's Fios, all-fiber network.

Here are some of the highlights:

Fios on speed: Verizon is already in the process of upgrading its Fios network to a technology called GPON or gigabit passive optical network, which will quadruple the capacity of the network. Wegleitner said this upgrade should give the company enough capacity to satisfy customers' needs for at least another three to four years. After that, he said, the company is already testing new technologies, such as 10GPON and another called Wave Division Multiplexing or WDM, which splits the light on each fiber to provide one wavelength per household. The verdict is still out on which technology the company will use, but the ultimate goal is to eventually deliver 100 megabits per second to any device in the home.

Troubleshooting from afar: Using a remote management standard called TR-69, Verizon will be able to peer into TV set-top boxes to fix problems without ever sending a technician to your home. Today, Verizon is able to do some diagnostics on the network to test for particular problem, but Wegleitner admitted today's capabilities aren't much different from what the cable industry already provides. But that will soon change. Using this remote management technology, Verizon will be able to do much more than ping devices and reboot them from afar. The function is still in development, but Wegleitner said it should be commercially available in the first half of next year.

IPTV all the way: Verizon has built its Fios TV service on what's considered a hybrid network. It uses IP to deliver video on demand and games. But it uses more traditional cable-like infrastructure to deliver broadcast TV. Wegleitner said the hybrid approach has served the company well, allowing it to quickly provide TV service to 348,000 homes as of the end of the first quarter of 2007.

"At the time we started the Fios deployment, we didn't think IPTV would be able to scale quickly enough," he said. "So we found a better way. We developed a hybrid solution that gave us the scale we needed along with some flexibility."

Still, he admitted that IP inherently provides more flexibility than traditional video infrastructure. And because of that fact, Verizon will migrate more video services onto IP over the next three to four years. Eventually, he said the entire Fios TV infrastructure will run over an IP network, much like what AT&T is offering today.

High-definition video-on-demand on-the-way: These days everyone and his brother is hot for high-definition TV programming. Wegleitner said "in a matter of months" Verizon will offer some of its video-on-demand content in HD. He wouldn't get more specific about the timing, except to say that Verizon is testing the service in its labs today.

I'll be sitting down with Wegleitner on Tuesday for a more in depth one-on-one interview, so look for a Newsmaker later in the week. I'm also working on a feature looking more closely at Verizon's Fios service. That too should be posted later in the week, so keep your eyes peeled. And if any Fios subscribers want to share their thoughts on the service, please feel free to e-mail me at maggie.reardon@cnet.com.

Microsoft said Monday that's it's revamped its IPTV software, now called MediaRoom. In a feature published Monday on CNET News.com, I've already gone into some depth about what the new software offers and what it means for the telco TV market.

But I also wanted to point out an important feature the new software doesn't offer: multiroom DVR. This service would be a dream come true for me. Even though I've got three TVs in my tiny apartment in New York City, my roommate and I still fight over the TV in the living room. Why? It's the only one with the DVR. We've each gotten so accustomed to watching recorded TV on our own schedules that neither of us even watches TV in our bedrooms, because then we'd have to watch TV live. Oh, the horror!

The situation has caused some tension between us. I refuse to watch American Idol or Dancing with the Stars, even though I know we can fast-forward through the boring parts. I also might be the only person in America who can't stand Lost. By the same token, my roommate has no interest in the latest Frontline episode or Charlie Rose interviews. We have found some common ground with shows such as The Office, 30 Rock and Grey's Anatomy. And of course we're both anxiously awaiting the new season of Project Runway.

But a multiroom DVR could end a budding war in my household. I could watch my boring PBS shows anytime I want in my room, while she could belt out bad pop songs on American Idol in hers.

Microsoft says the feature will be added in later releases. Ed Graczyk, a director of marketing for Microsoft, said the reason it wasn't in the current version of the software is that IPTV operators didn't see it as a top priority. AT&T said it's considering offering multiroom DVR functionality, but it didn't give any specific plans.

But I think AT&T and other telcos using Microsoft's software are missing a big opportunity to differentiate their services. Verizon has offered multiroom DVR for almost a year. EchoStar's Dish network also offers it. And Time Warner (my cable provider) has it in some locations. (Too bad for me Manhattan isn't one of them.)

Unfortunately, even if Microsoft had added multiroom DVR to this current version of software, it still wouldn't change my situation. I don't live in any of the 21 cities where AT&T is offering its IPTV U-verse service. (AT&T is the largest IPTV provider in the U.S. using the Microsoft MediaRoom software.)

That said, I think I'm a pretty average consumer. And the multiroom DVR function would definitely prompt me to go through the hassle of changing my service. And if I'd do it, maybe other people would too.