I think I understand where Apple is going with its overall market strategy. Steve Jobs wants to be the King of All Media. With iTunes, and especially the video features in new iPods and deals to download TV shows onto them for $2 a pop, he may just do that, at the expense of the record labels and television stations. The strength of both of them, and their role as gatekeepers for what media the consumer sees, is on its way down. In the future, Apple will probably directly deal with content providers as it does with customers. As of right now, the $1 iTunes price is far below the gouge price that CDs put music at, and $2 is far less than cost for cable TV for moderate TV watchers or for those that would own episodes on DVD. Radical improvements in technology lead to shifts in power distribution, and that's central to Jobs' strategy. I think it's correct that in the long run, winning the battle against PCs doesn't matter to Apple, because Jobs is going for a market that's both bigger and more ripe for change than the personal computation market.
Also amusing, Apple's new iMac has a camera embedded in it that lacks a cover. iBig iBrother? Perhaps. Imagine the joy of law enforcement people, who might start asking for electronic wiretap warrants whereby they'd visit your PC while you were out, plug in a USB key, install software that would controllably broadcast audio and video to the government, and leave. Scary.