And here it is ... the pocket-rocket version of Apple TV with $4.99 first-run movies and $0.99 TV shows. The main content events: as expected, ABC (NYSE: DIS), Fox and Netflix (NSDQ: NFLX). And, as expected, it’s a heck of a lot cheaper: a much more competitive $99, down from the original $299 and the current $229. CEO Steve Jobs promises availability in four weeks; pre-orders start today. One surprise: it’s all rental, no purchases. It’s also a conduit, not a storage device.

Apple (NSDQ: AAPL) CEO Steve Jobs says the emphasis on a sleeker device at a much lower price with inexpensive “Hollywood” content is the result of user feedback over the four years since Apple TV debuted. “They want Hollywood movies and TV shows whenever they want them. They want Hollywood, they don’t want amateur hour. They want everything in HD. They’d like to pay lower prices; the lower the prices, the more they’re going to watch. They don’t want computer on TV.”

Think about that last one.

Once again, Jobs is zigging where a lot of others are zagging, offering the TV more as a screen than a convergence device. It may do a lot more but the version of Apple TV I heard described today is a step above a digital video player—a sophisticated step, to be sure, with what looks like a slick user interface and access to more than pro rental content. In a world that often equates computers with frustration, he’s pitching simplicity. From his tick list: “They don’t want to manage storage. They don’t want to sync to a computer. They want to pull some content off; they want silent, cool and small.”

The Apple version of TV Everywhere: But Jobs isn’t really leaving the computer or other devices behind. The more sophisticated step is AirPlay, which may turn out to be the real breakthrough here. The current Apple TV allows streaming from the computer; the second-gen model adds access from the iOS devices. Take an HD video with your iPhone and with Apple TV as the pipe it can show up wirelessly on the TV. The same holds for commercial content that’s on the devices—rent a TV show on iTunes via your iPhone, iPad or iPod Touch, start watching there and switch to the TV. It’s the Apple version of TV Everywhere but the programming is pay as you go. The devices also can act as high-end remote controls using the Apple Remote app.

Crowded marketplace: It isn’t rocket science and I’m not sure why it took four years to figure it out. Apple TV never really broke through as a consumer device. It was too limited and too expensive. And, in my experience, too hard to sell in big-box stores that didn’t know what to do with it.  (One clue about how it did: in a session chock full of sales stats, he only said they sold “a lot of them.”) Jobs shrugged off that failure: “It’s never been a huge thing nor has any competitive product, nothing has really hit the living room yet.” 

He’s right, Apple TV isn’t the only device that failed to own the living room although there are probably more Windows Media Centers then first-gen Apple TVs in use. Now, despite numerous failures by companies large and small that thought they could rule the in-home video world, Apple enters a more complicated “Connected TV” marketplace crowded with over-the-top contenders, TV manufacturers, multi-room pay TV, and others trying to keep their place or break through. (That’s one of the reasons we’re bringing people together at our Battle for the Digital Home conference in Hollywood, Nov. 8.)

Still, Apple has weapons the others don’t: its brand, reputation, buzzy retail outlets for hands-on demos, and a fast-growing ecosystem that covers the bases. It can’t force success (see above) but it has an instant head start even when it’s late to the game.

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